CMS Issues Guidance on TKA Patient Status

on Monday, 28 January 2019. All News Items | Patient Status | Documentation

As you may be aware by now, on January 8, 2019 Medicare issued MLN Matters Article SE19002, “Total Knee Arthroplasty (TKA) Removal from the Medicare Inpatient-Only (IPO) List and Application of the 2-Midnight Rule,” and then after an instantaneous, critical response from the healthcare community immediately withdrew the article. On January 24, 2019, they reissued the article and again there was rapid negative critique of their scenarios. I, too, see the errors in some of their examples. In my opinion, they could write 100 examples and most would be subject to some criticism. I believe this is why they have been so hesitant to offer examples of the “case-by-case exception” for an inpatient admission when a greater-than-2-midnight stay is not expected. Hopefully CMS learns from this situation just how very hard it is to apply their rules. I maintain that even though their examples and wording are not perfect, there is something for hospitals to learn from this article.

Solid Documentation

The documentation in your medical records serves more than one function. Most importantly, medical documentation serves to communicate information about a patient’s condition and care between healthcare team members to ensure continuity of care, foster quality care, and improve efficiency of care. Medical documentation is also a legal document that serves as evidence of the care provided, especially in the case of a lawsuit. And it is the medical record that ultimately provides the justification and rationale to support payment for the medical items, tests, and services selected and provided to the patient.

Those of us that deal with Medicare are often reminded that documentation must support the medical necessity of services. It is not good when that reminder comes in the form of a claim denial following a complex medical review, such as reviews of the medical necessity of inpatient admissions. It is best to know what is expected up front so we can follow Medicare’s guidelines and make sure our documentation is thorough and solid enough to support Medicare’s requirements for payment.

Likewise, it is helpful when CMS shares the basis for their coverage and payment rationale, preferably in the form of guidance prior to an actual review. Hospitals have been waiting since the 2016 “case-by-case exception” for further guidance on what would justify the use of this exception. Also, hospitals have been confused by statements made in the final rule when total knee arthroplasty was removed from the inpatient-only list in 2018. TKAs are now paid by Medicare when performed as an outpatient or an inpatient, but when is inpatient admission for a TKA appropriate? Finally, CMS has issued a Special Edition MLN Matters Article SE19002 that addresses Total Knee Arthroplasty (TKA) Removal from the Medicare Inpatient-Only (IPO) List and Application of the 2-Midnight Rule. This article describes the circumstances when an inpatient admission for a TKA would be appropriate and even provides specific examples.

An inpatient admission for a TKA is appropriate when 1) there is an expectation of medically necessary hospital services spanning 2 midnights or longer or 2) there is not an expectation of a 2 midnight stay but the physician/practitioner determines other complex medical factors support an inpatient admission.

Providers should read the SE Article carefully as it provides a lengthy discussion on the topic. Here is a summary of some of that discussion. Inpatient admission for a TKA is appropriate when:

  • The admitting physician/practitioner has a reasonable expectation that the patient will require medically necessary hospital services spanning 2 midnights or longer and admits the patient to the hospital based on that expectation.
    • If the patient remains an inpatient receiving medically necessary hospital services for greater than 2 midnights and the patient’s medical record documents the medical necessity of a hospital level of care, this meets the 2-Midnight Presumption. Under the 2-Midnight Presumption, which helps guide contractor selection of claims for medical review, hospital claims with lengths of stay greater than 2 midnights are presumed to be reasonable and necessary for Medicare Part A payment.
    • Even if the patient is discharged prior to a second midnight, as long as documentation supports that at the time the inpatient order was written, there was a reasonable expectation of medically appropriate hospital care spanning 2-Midnights, this supports the 2-Midnight Benchmark. Under the 2-Midnight Benchmark, hospital claims are generally payable when the admitting practitioner reasonably expected the beneficiary to require medically necessary hospital care spanning 2 or more midnights and this expectation is supported by the medical record documentation. The 2-Midnight Benchmark helps guide contractor reviews of short stay hospital claims for Part A payment.
  • The admitting physician/practitioner does not expect the patient to need hospital care beyond a second midnight, but determines the patient requires hospital inpatient care based on complex medical factors supported in the medical record and including but not limited to:
    • Patient’s history, co-morbidities, and current medical needs
    • Severity of signs and/or symptoms, and
    • Risk of Adverse Events

The article also emphasizes that TKAs do not always have to be performed as an outpatient and that CMS does not target TKA Short Stay inpatient claims for review.

It is also interesting to note that in the 2018 OPPS Final Rule, CMS made the following statements:

“However, we do not expect a significant volume of TKA cases currently being performed in the hospital inpatient setting to shift to the hospital outpatient setting as a result of removing this procedure from the IPO list. At this time, we expect that a significant number of Medicare beneficiaries will continue to receive treatment as an inpatient for TKA procedures.”

In a seemingly contradictory statement, SE19002 notes, “CMS has not made any pre-determinations on the number of patients receiving TKA procedures that should be treated as an inpatient or outpatient.”

Sometimes even CMS’s documentation is not solid enough to stand up to an audit.

Article by Debbie Rubio

Debbie Rubio, BS, MT (ASCP), is the Manager of Regulatory Affairs and Compliance at Medical Management Plus, Inc.  Debbie has over twenty-seven years of experience in healthcare including nine years as the Clinical Compliance Coordinator at a large multi-facility health system.  In her current position, Debbie monitors, interprets and communicates current and upcoming regulatory and compliance issues as they relate to specific entities concerning Medicare and other payers.  You may contact Debbie 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.

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