Front-end process avoids problems with observation
Observation vs. admissions can be confusing
Hospital case management departments should take the lead in making sure patients are placed in the right status by establishing a front-end process to make sure that problems in observation status vs. admission status don’t occur.
Your hospital’s Program for Evaluating Payment Patterns Electronic Report (PEPPER) is a good starting point to determine whether you have a high percentage of one-day stays, says Teresa Fugate, RN, BBA, CPHQ, CCM, a manager with Pershing, Yoakley & Associates, a Knoxville, TN-based health care consulting firm.
PEPPER data, reported quarterly through your state’s quality improvement organization (QIO) show how your hospital stacks up in areas that CMS has determined are high risk for payment errors.
If hospitals have a high percentage of one-day stays, that may prompt more investigation into whether the stays meet medical necessity guidelines, Fugate says. "Patients may or may not have met medical necessity for their one-day stays. If they didn’t, it increased the hospitals’ one-day stay numbers when the [QIO] started doing the audits," she says.
Start by studying medical necessity on admission denials, tracking the route the patients took to be admitted to the hospital, and looking for patterns and vulnerable patient populations. Then drill into the data to find patterns of diagnoses on which you should focus, suggests Toni Cesta, RN, FAAN, vice president of patient flow optimization for the North Shore-Long Island Jewish Health System, based in Great Neck, NY.
The emergency department (ED) and the outpatient surgical area are the two places in the hospital where problems with admission status are likely to occur, points out Deborah Hale, CCS, president of Administrative Consultant Services Inc., a Shawnee, OK-based health care consulting firm.
"We recommend that hospitals establish an emergency department case management staff to get the patient in the appropriate status, rather than making changes later," Fugate says.
Physicians don’t always understand the criteria for observation vs. admission. That’s why it’s useful to have an ED case manager reviewing all admissions, she adds.
"It’s helpful to have an emergency department case manager right there to evaluate medical necessity and documentation. In many cases, the patient may meet inpatient criteria but there is not enough documentation. The case manager can work with the doctor to get the documentation needed for medical necessity," Fugate points out.
While case managers on the floor typically see all patients, they usually don’t conduct the review until 24 hours after admission.
To avoid denials because a patient is in the wrong status, Fugate recommends that case managers review the medical records at the time of admission and talk with the physician in the ED about appropriate status. "It’s a matter of being concurrent rather than retrospective," she says.
Create a process in which patients’ charts automatically go to the ED case managers for review as soon as the physician writes a diagnosis, Cesta suggests.
Case managers should work with the physician staff to make them aware of the criteria for observation, she says. "The case manager in the emergency department provides good checks and balances to ensure that the patient meets criteria." Case managers should make sure the physician writes the correct wording on the chart when placing patients in observation status, Cesta notes.
It must say "placed on observation" instead of "admitted to observation," which implies a hospital admission, she adds.
Case managers also should take a proactive approach to patients coming to the hospital for outpatient surgery, screening the patients before surgery to determine what their status is likely to be, Hale suggests.
When patients come in for their preoperative teaching, a nurse should evaluate them to determine if they are likely to be able to go home after the procedure or are likely to require an overnight stay. For instance, a patient with severe heart disease may need more care after surgery and most likely will need to be admitted.
If a procedure is performed in the outpatient setting, case managers should follow up after the procedure to make sure everything is going smoothly, she says.
For instance, a patient may be scheduled for incisional hernia repair, but the surgeon may nick the bowel or the procedure may turn out to be more complicated than the surgeon originally thought, resulting in the performance of an "inpatient-only" procedure.
"If the hospital isn’t paying attention and does not convert the outpatient procedure to an inpatient admission, they may have the whole thing denied," she says.
Compile a list of surgical procedures performed in your facility that are on Medicare’s "Inpatient Only" list and post for easy access by the staff. In many hospitals, particularly the larger ones, physicians are not always up to speed on what Medicare does and doesn’t allow, Hale continues.
"Somebody needs to be screening procedures to make sure they are ordered in the right site of service," she adds.
Here are some other tips for ensuring your hospital places patients in the proper status:
- Develop a system for screening patients for medical necessity. Each patient should be assessed individually, Fugate recommends.
- Audit your one-day stays using criteria that are recognized in your particular state, Hale advises.
- Review admissions that are less than 24 hours to see if particular case types are being overlooked by ED staff, Cesta says.
- Develop pre-printed order sets and protocols to assist physicians in documenting the short-stay admissions. Use a format consistent with your other case management plans, she says.
- Develop a pre-printed interdisciplinary observation documentation record. Physician documentation should include anticipated time frame for observation, an abbreviated history and physician, and the reason for observation. In addition to traditional admission documentation, nursing documentation should include the reason for observation and anticipated time frame as per the physician, times of interventions, diagnostic studies, and assessments, and time observation is completed, Cesta explains.
- Review your managed care contracts to make sure you have observation rates in your contract and determine whether your MCOs require pre-certification for admission to observation, she adds.
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