A Look Back at 2015: With an Eye Towards the Future

on Tuesday, 05 January 2016. All News Items | Case Management | Patient Status | Medicare Coverage

“Year’s end is neither an end nor a beginning but a going on, with all the wisdom that experience can instill in us.”
-          Hal Borland, Author, May 14, 1900 – February 22, 1978

The New Year and all of its possibilities is an exciting time of the year. But to begin “going on” with the New Year, you should first look back at key events of 2015 that will continue to have implications for hospitals in 2016. So let’s begin…


1st Physician Certification Requirement Revised:

Effective January 1, 2015, a Calendar Year (CY) 2015 Outpatient Prospective Payment System (OPPS) Final Rule policy finalized now limits the physician certification requirement to long-stay (20 days or longer) and outlier cases. A closer look at this change can be found in a related article at http://www.mmplusinc.com/news-articles/item/finalized-changes-to-physician-certification-requirements.

26th Better Care, Smarter Spending, Healthier People:

CMS announced measurable goals with a timeline to move Medicare away from paying for quantity towards paying providers based on the quality of care provided to Beneficiaries.

Alternative Payment Models (APMs) Goal
Percent of Medicare Payments in APMsYear
30% By end of 2016
50% By end of 2018
Examples of APMs: Medicare Shared Savings Program (MSSP), Pioneer Accountable Care Organizations (ACOs), Bundled Payment for Care Initiative and the Comprehensive Primary Care Initiative


Value Based Payments Goal
Percent of Medicare Fee-for-Service Payments Tied to Quality or ValueYear
85% By 2016
90% By 2018
Examples of Programs that tie Hospital Payment to Quality of Value: Hospital Value Based Purchasing (VBP) Program, Hospital Readmission Reduction Program and the Hospital-Acquired Condition (HAC) Program


4th Transmittal 567 New Timeframe for Response to Additional Documentation Requests (ADRs) Released:

The purpose of this change request (CR) was to update section of Chapter 3 of the Program Integrity Manual to address the new prepayment review timeframe for ADR submission and to instruct the Shared Systems maintainers to produce ADRs to reflect the new change.

4th Transmittal 568 Review Timeliness Requirements for Prepay Review Released:

The purpose of this CR was to change the number of days MACs have to conduct complex reviews from 60 days to 30 days.

A closer look at both Transmittals can be found in a related article at http://www.mmplusinc.com/news-articles/item/contractor-claims-review-deadlines.



10th Push for Socio-Economic Status Risk Adjustment in Readmission Reduction Program:

U.S. Senators Rob Portman (R-OH) and Joe Manchin (D-WV) and Representatives James Renacci (R-OH) and Eliot Engel (D-NY) introduced the Establishing Beneficiary Equity in the Hospital Readmission Reduction Program Act of 2015 (S.688) (H.R. 1343). This bill would require the CMS to account for socio-economic status when calculating the risk-adjusted readmission penalties.To date both pieces of legislation have not made it past the first step of the legislative process of being “introduced.”



16th MACRA enacted:

The Medicare Access and CHIP Reauthorization Act (MACRA) was enacted. Section 509 of this Act extended Medicare Administrative Contractor (MAC) contract terms from five years to ten years. This legislation applied to all contracts in effect at the time of enactment, meaning that current MAC contracts in place can be extended another five years to a maximum of ten.

16th Hospital Compare Star Ratings:

CMS released the first ever Hospital Compare Star Ratings with the aim of making it easier for consumers to choose a hospital and understand the quality of care delivered. You can learn more about Star Ratings by accessing an October 8, 2014 CMS National Provider Call at https://www.cms.gov/Outreach-and-Education/Outreach/NPC/Downloads/2014-10-08-StarRatings-Presentation.pdf.


28th Office of Inspector General (OIG) Releases FY 2015 Work Plan Mid-Year Update:

The Mid-Year Update became effective May 2015. This update removed items that had been completed, postponed, or canceled and included new items that had been started since October 2014. There were two new projects added to the Work Plan specific to Hospitals.

  • Intensity-modulated radiation therapy (IMRT): The OIG plans to review Medicare outpatient payments for IMRT to determine if payments were made in accordance with Federal rules and Regulations.
  • Hospital preparedness and response to high-risk infectious diseases: The OIG will describe hospitals’ efforts to prepare for the possibility of public health emergencies resulting from infectious diseases. They will also determine hospital use of HHS resources and identify lessons learned through recent experiences with pandemic or highly-contagious disease, such as Ebola.


1st CMS Posts Annual Payment Data:

CMS released their now third annual Medicare hospital data and second annual release of physician and other supplier utilization and payment data. CMS indicated in a Press Release that “data releases are part of a wide set of initiatives to achieve better care, smarter spending, and healthier people through our health care system. Open sharing of data securely, timely, and more broadly supports insight and innovation in health care delivery.”


1st CMS Releases Proposed Updates to the Two-Midnight Rule:

CMS released the CY 2016 OPPS Proposed Rule. This Release included a proposed update to the Two-Midnight Rule. CMS stated in a related Fact Sheet that “these changes would continue CMS long-standing emphasis on the importance of a physician’s medical judgment in meeting the needs of Medicare beneficiaries.”

8th CCJR Model Proposal:

CMS announced a proposal for a Comprehensive Care for Joint Replacement (CCJR) Model to test bundled payment and quality measurement for hip and knee replacements. If finalized, this Model would be the first time that CMS has made participation in a Model mandatory for hospitals identified for inclusion by CMS.

30th Medicare and Medicaid 50th Anniversary:

On July 30, 1965, President Lyndon B. Johnson signed into law legislation establishing the Medicare and Medicaid programs. CMS marked this anniversary by recognizing the ways in which these programs have transformed the nation’s health care system over the past 5 decades.


3rd Fiscal Year (FY) 2016 Readmission Penalties:

CMS Released the FY 2016 Readmission Penalties. With hospitals facing financial challenges, do you know your Hospital’s Readmission Penalty for FY 2016? Kaiser Health News (KHN) is a nonprofit national health policy news service and on August 3rd, Jordan Rau of KHN released the article Half of Nation’s Hospitals Fail Again To Escape Medicare’s Readmission Penalties. This article provides a link to a PDF file of Medicare Readmission Penalties by Hospital for all four years of the program (FY 2013 through FY 2016).

The entire article can be accessed at: http://khn.org/news/half-of-nations-hospitals-fail-again-to-escape-medicares-readmission-penalties/?utm_campaign=KHN%3A+Afternoon+Edition&utm_source=hs_email&utm_medium=email&utm_content=21032373&_hsenc=p2ANqtz--tfj9Nw4n9neCfizWv04BocrIp3tC95xA5l23W02GylGLyB4LwwY-TqyPtYDzFc3SMx6mV8RP_X1MzflMnd3EhbTYe4g&_hsmi=21032373

6th NOTICE Act:

President Obama signed into law the Notice Act (Notice of Observation Treatment and Implication for Care Eligibility Act). This law will require hospitals and critical access hospitals to provide notification to Medicare beneficiaries receiving observation services as outpatients for more than 24 hours. The date that hospitals will be required to be in compliance with this Act is August 6, 2016.

12th Timeline for Inpatient Status Reviews:

CMS provided the following timeline of the Medicare Contractor responsible for Inpatient Status Reviews on their Inpatient Hospital Reviews web page.

Summary of Inpatient Status Reviews
Data of AdmissionContractor Type(s)
Through September 30, 2015 MACs conducting probe and educate
October 1, 2015 through December 31, 2015 BFCC-QIOs conducting reviews.
MACs completing any remaining provider education
January 1, 2016 and beyond BFCC-QIOs conducting initial reviews.
RACs conducting further reviews upon referral by QIOs.


4th Supplemental Medical Review Contractor (SMRC) Announces IMRT Medical Record Review Project:

Strategic Health Solutions, LLC is the SMRC Contractor for the entire country. SMRC projects may include, but are not limited to issues identified by Federal Agencies, such as the OIG, Comprehensive Error Rate Testing (CERT) program or Program for Evaluating Payment Patterns Electronic Report (PEPPER). On September 4th Strategic Health Solutions posted a new project where they will be conducting post payment medical review of IMRT Services. The Sample ADR letter provided on the website cites the reason for this project as being “analysis of Medicare claims data for calendar year 2012 indicated a significant increase in billing and payment related to the medical necessity and volume of related ancillary services for” IMRT. Reminder: Review of IMRT Services was also a new Project in the OIG’s FY 2015 Mid-Year Work Plan.

18th IMPACT Act Passed:

Congress passed the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act). The Act requires the submission of standardized data by Long-Term Care Hospitals (LTCHs), Skilled Nursing Facilities (SNFs), Home Health Agencies (HHAs) and Inpatient rehabilitation Facilities (IRFs). CMS held the Improving Medicate Post-Acute Care Transformation Act MLN Connects National Provider Call on October 21, 2015. To learn more about this Act you can access the Transcript from this call at https://www.cms.gov/Outreach-and-Education/Outreach/NPC/Downloads/2015-10-21-Post-Acure-Care-Transcript.pdf.

22nd NOTICE Act Implementation Plans:

CMS indicated during an Open Door Forum (ODF) that they are “developing implementation plans” for hospitals to fulfill the requirements of the NOTICE Act.


1st ICD-10 FINALLY Implemented!

1st BFCC-QIO’s assumed responsibility for Inpatient Status Reviews:

As part of the CY 2016 OPPS Proposed Rule, CMS transitioned Inpatient Status Reviews to the BFCC-QIO. Guidance about the new short-stay review process can be found in a related article at http://www.mmplusinc.com/news-articles/item/two-midnight-rule-once-again-to-be-or-not-to-be.

26th CMS Release Hospital Value Based Program (VBP) Results for FY 2016:

FY 2016 VBP Program by the Numbers
1.75% The law requires that the percent reduction increase from 1.50% to 1.75% of the base operating Medicare Severity Diagnosis-Related Group (MS-DRG) payment amounts to all participating hospitals.
$1.5 Billion This is the approximate estimated amount that will be available for value based incentive payments in FY 2016.
3,000 This is the number of hospitals across the country where this program will impact their payment for Medicare Fee-for-Service Inpatient Hospitalizations.

A closer look at the results can be found in a related article at http://www.mmplusinc.com/news-articles/item/fiscal-year-fy-2016-results-for-the-cms-hospital-value-based-purchasing-program.

29th Proposed Revisions to Discharge Planning Conditions of Participation (CoP):

CMS released proposed revisions to the discharge planning requirements that hospitals, including Short-Term Acute Care Hospitals, Long-Term Care Hospitals (LTCHs), Inpatient Rehabilitation Facilities (IRFs), Critical Access Hospitals, and Home Health (HH) agencies must meet in order to participate in the Medicare and Medicaid program. Passage of this proposal would be a tremendous undertaking for all involved in the discharge planning process. CMS accepted comments through 5 p.m. on January 4, 2016.

30th New 2-Midnight Rule Exception Finalized:

A new 2-Midnight Rule Exception was finalized in the October 30th release of the CY 2016 OPPS Final Rule. CMS indicated in the Final Rule that “after consideration of the public comments we received, we are finalizing, without modification, our proposal to revise our previous “rare and unusual” exceptions policy to allow for Medicare Part A payment on a case-by-case basis for inpatient admissions that do not satisfy the 2-midnight benchmark, if the documentation in the medical record supports the admitting physician’s determination that the patient requires inpatient hospital care despite an expected length of stay that is less than 2 midnights.” A closer look at this new exception can be found in a related article at http://www.mmplusinc.com/news-articles/item/two-midnight-rule-once-again-to-be-or-not-to-be.


2nd FY 2016 OIG Work PlanReleased:

Examples of Projects specific to Short-Term Acute Care Hospitals in the plan include:

  • Project Hospitals’ use of outpatient and inpatient stays under Medicare’s Two-Midnight Rule,
  • Inpatient claims for mechanical ventilation; and
  • Payments for patients diagnosed with kwashiorkor.

13th Current Recovery Auditor Contracts Modified:

CMS announced that all current Recovery Auditors have signed a contract modification and may continue active recovery auditing activities, including sending additional documentation requests (ADRs) through July 31, 2016.

16th The Final Rule for the Comprehensive Care for Joint Replacement Model (CJR) Released:

This Model is set to start April 1, 2016. Participation is mandatory for the hospitals identified by CMS for inclusion. A closer look at this model can be found in a related article at http://www.mmplusinc.com/news-articles/item/comprehensive-care-for-joint-replacement-model-finalized.


10th CMS Refreshed Data on Hospital and Physician Compare websites:

CMS noted in a Press Release that new quality measures have been added to Physician Compare. CMS also noted that the Hospital Compare data has been refreshed and updated to include new data and several new measures.

21st CMS TeleTown Hall Meeting regarding the NOTICE Act:

CMS held a TeleTown Hall Meeting to receive comments and/or concerns from the health care community as they work through providing guidance on how to implement the NOTICE Act.

As you can see much of what occurred in 2015 laid a foundation for continued change in 2016 and I am once again reminded that change is the one constant in healthcare. From all of us at MMP, Happy New Year!

Article by Beth Cobb

Beth Cobb, RN, BSN, ACM, CCDS, is the Manager of Clinical Services at Medical Management Plus, Inc. Beth has over twenty-four years of experience in healthcare including eleven years in Case Management at a large multi-facility health system. In her current position, Beth monitors, interprets and communicates current and upcoming Case Management / Clinical Documentation issues as they relate to specific entities concerning Medicare. You may contact Beth at This email address is being protected from spambots. You need JavaScript enabled to view it..

This material was compiled to share information. MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.

green-iconWe are an environmentally conscious company, dedicated to living “green” both at work and as individuals.


1900 Twentieth Avenue South
Suite 220
Birmingham, AL 35209


This email address is being protected from spambots. You need JavaScript enabled to view it.