Proposed rule clarifies admission policies.

In the Inpatient Prospective Payment System proposed rule for fiscal 2014, the Centers for Medicare & Medicaid Services (CMS) has proposed changes to how auditors review inpatient admission and announced plans for basing reimbursement on additional quality measures. CMS proposes that auditors should presume that inpatient status is appropriate if there is a physician order and the stay spans two midnights. The agency proposes penalizing hospitals for excess hospital-acquired conditions, adding chronic obstructive pulmonary disease and total hip and knee replacements to the readmission reduction program, and announced that it is considering adding a measure to value-based purchasing in fiscal 2017 that assesses a hospital's performance in treating Medicare patients appropriately as inpatients or outpatients. The Recovery Auditors and other Medicare contractors will continue to scrutinize medical records and are likely to shift their emphasis to 0-to-3-day stays.