News to Note – September 2026

  • Inpatient Rehabilitation Facilities (IRFs) will soon be required to provide specific services which will likely affect hospital length of stay in a negative way.
    • Every necessary therapy modality must begin within 36 hours of the first midnight following admission. Previously, there was some ambiguity in the regulations but not anymore. This could very likely lead to IRFs refusing to accept new patients on Fridays if there’s any possibility that they won’t have therapists of every modality in the facility over the weekend to initiate care. And what if the following Monday is a holiday? It’s feared this will lead to longer hospitalizations.
    • The first interdisciplinary team meeting must occur within four days of admission, rather than the current seven days. As a result, IRFs may be less likely to accept patients on Thursdays because each service would be required to assess the patient on Thursday or Friday, and the interdisciplinary meeting would need to occur by Friday afternoon—unless the IRF has all therapy services and the physiatrist in-house at the same time over the weekend. 
  • The Centers for Medicare and Medicaid Services (CMS) released the Inpatient Prospective Payment System (IPPS) Final Rule last month and as expected, they finalized most of their proposals. Here are just a few:
    • Comprehensive Care for Joint Replacement Expanded (CJR-X), a national, mandatory total joint replacement bundled payment program, was finalized. It will start on January 1, 2028.  At that point, hospitals will be responsible for all costs incurred in the 90 days following surgery. 
    • Sepsis will be added to the readmission reduction program. For hospitals that use SIRS as their criteria for diagnosing sepsis, a higher volume of sepsis patients may result in an increase in readmission penalties in future years. Will the added DRG payment compensate for the increased penalty and adverse effects on quality ratings? It’s not clear.
    • As many feared, the comorbid condition (CC) designation for housing insecurity was dropped.
    • The Advance Care Planning Electronic Clinical Quality Measure (eCQM) was finalized as a new, self-selected electronic quality measure and is expected to start voluntarily in 2028.  Then, in 2029, it will become mandatory for the fiscal year 2031 payment determination under both the Hospital Inpatient Quality Reporting (IQR) Program and the Medicare Promoting Interoperability Program.
      • This measure goes beyond asking the question, “Do you have an Advance Directive?”  Instead, CMS intentionally designed the measure to recognize multiple ways hospitals can demonstrate meaningful advance care planning, either by verifying that appropriate documents exist in the medical record or that clear documentation supports this measure.
      • A patient meets the numerator if any one of the following exists by hospital discharge from an Inpatient encounter:
        • Documented health care proxy or medical power of attorney
        • Advance directive or living will
        • POLST, MOLST, or qualifying DNR order
        • Documentation of an advance care planning discussion that resulted in a documented decision in the electronic medical record (EMR)
      • Hospitals won’t be penalized when patients decline to complete an advance directive or designate a health care proxy. Documentation that an advance care planning conversation occurred, even when the patient chooses not to make decisions or wishes to defer the conversation, will still satisfy the numerator requirements if documented appropriately.
      • The measure doesn’t require a new document to be completed every hospitalization. Existing advance care planning documentation already available within the patient’s EMR satisfies the measure, provided it remains accessible during the hospitalization. 
      • Another notable aspect is the broad denominator. The measure applies to all Inpatient hospitalized adults aged 18 years and older, regardless of diagnosis, severity of illness, or length of stay. 
      • CMS emphasized that serious illness, unexpected injury, and loss of decision-making capacity can occur at any age, making advance care planning relevant for every adult patient hospitalized in an acute care hospital. For hospitals accustomed to focusing advance directive discussions primarily on older adults or palliative care populations, this represents a substantial workflow expansion. Now is a good time to begin collaborating with quality, nursing, case management/social work, palliative care, medical staff, registration, chaplaincy, and IT teams to assess your hospital’s current compliance and identify opportunities to standardize documentation in discrete medical record fields for data collection. 
  • Michael Fancher, Vice President of Business Development at Kindred Hospitals, a national Long-Term Acute Care Hospital (LTACH) operator, developed an online tool to determine if a patient qualifies for LTACH care based on national standards. 
    • Additionally, if the patient does qualify, the tool provides arguments which can be used with payors who deny transfer.
    • While individuals must register to use the tool, it is free, registrants aren’t added to a mailing list, no PHI is collected, and it’s unaffiliated with Kindred. 
  • CMS loves to mandate forms, and surveyors love to survey about proper completion and delivery of those same forms. But CMS is remarkably inconsistent about creating these forms. 
    • When hospitalizing a patient as Inpatient, CMS developed and mandated the use of the Important Message from Medicare (IM). For patients receiving Observation services, there is the Medicare Outpatient Observation Notice (MOON).
    • On the other hand, CMS mandates that patients whose status has changed from Inpatient to Outpatient via the Condition Code 44 process receive written notification. However, they have not developed a form for that, and hospitals are free to create their own and cross their fingers that it meets the requirements. 
    • There’s a similar issue involving critical access hospitals. When a patient is in a skilled nursing facility (SNF) under Medicare Part A, the SNF is required to deliver the Notice of Medicare Non-Coverage (NOMNC) to patients at least two days before their covered stay ends. Like the IM, there’s a CMS-designed form that must be used, which notifies the patient of their right to appeal the termination of their covered care to the Quality Improvement Organization (QIO).
      • One of the QIOs reported that when patients appeal, they are successful 40% of the time. This statistic is notable because when hospital Inpatients appeal, the QIO sides with the patient only about 15% of the time.
      • Here’s the form issue: if the patient is in a Medicare Part A SNF stay in a swing bed in a critical access hospital, they’re also required to be given a form called the “Notice of Transfer or Discharge.” Unlike the NOMNC, there’s no mandated form from CMS, so one must be developed that meets the requirements. 
        • Unlike the NOMNC, when a patient is unhappy with their impending discharge, they appeal not to the QIO but to the Long-Term Care Ombudsman. Under the regulations, a patient who is in an acute care stay receiving Medicare Part A skilled nursing care in a swing bed in a critical access hospital has two options to appeal: the QIO or the Long-Term Care Ombudsman. Just considering the name, this is confounding. The patient’s care is not long term. Everything about the ombudsman process indicates that it’s intended for people who are living in long-term care facilities like a nursing home, and not patients who are receiving skilled nursing and therapy care on a short-term basis. 
        • Why is this form used for swing beds in critical access hospitals? Swing beds are usually located within acute care hospitals. Critical access hospitals and rural hospitals generally don’t provide long-term care. And why not require the form’s use at rural hospitals that also have swing beds?
        • It’s suspected that when swing bed regulations at 42 CFR § 482.58 were developed, CMS made a mistake by including a reference to the “Notice of Transfer or Discharge,” which is intended for long-term care residents in nursing homes or assisted living facilities (ALFs) who are being evicted. But it’s still required for the time being.
  • The Office of the Inspector General (OIG) has a work plan that includes issues they think warrant attention. One item the OIG gravitates towards is hospital-acquired conditions, and they announced that they will be looking for “ventilator-associated events.” 
    • Per the work plan, the OIG “will determine the incidence of ventilator-associated events among hospitalized Medicare patients and its associated costs to Medicare.” 
    • The way the OIG defines a ventilator-associated event is not specified, but the Centers for Disease Control and Prevention (CDC) has protocols that use an increase in FiO2 and PEEP for at least two days as part of the criteria. You may want to alert your ICU teams that they will soon be facing more scrutiny. 
  • Wellcare and Fidelis announced that they will no longer allow peer-to-peer (P2P) discussions to result in a reversal of a denial. Instead, the formal appeal process must be used. 
    • They state that P2P discussions can only be used for clarification of clinical rationale. This can be especially frustrating when the patient requires post-acute care and the Medicare Advantage (MA) plan denies approval. Two things are worth noting:
      • First, there is no CMS regulation prohibiting P2P discussions. The plans just don’t want to do them. 
      • Second, the patient or any physician has a right to file an expedited appeal, at which point the plan has 72 hours to respond. This process should be outlined in the denial letter from the plan and should be used liberally.
    • If the denial is a blatant violation of Medicare regulation, such as denying Inpatient status for a patient with a two-midnight expectation or a patient meeting Medicare criterion for transfer to a SNF or IRF, be sure to continue to file complaints with CMS. 
  • When a MA denial is upheld on appeal, the MA plan is required to forward it to the Qualified Independent Contractor (QIC). CMS recently awarded the contract for Medicare Part C QIC services to a company called C2C. Based on anecdotal reports, though, it appears C2C is not performing as well as it should as a Medicare contractor. 
    • Hospitals are having trouble contacting them, getting case numbers to track pending appeals, and receiving notification letters at the correct address. It seems C2C is sending notification letters to the hospital’s street address rather than to the specific address on file with the MAC. 
    • If you’re having trouble communicating with C2C, be sure to express your displeasure to your regional CMS office. 
  • The FDA has now approved a robot phlebotomist. That’s right, a machine that can draw blood all by itself. 
    • The device guides the patient to position their arm, after which the patient or supervisor presses a button to start the blood draw. The robot then uses near-infrared light and Doppler ultrasound to locate a suitable vein and tell it apart from arteries. If no appropriate vein is found, the robot will not attempt the procedure.
    • Once a vein is identified, the robot proceeds through the remaining steps on its own: applying a tourniquet, preparing the skin, inserting and disposing of the needle, changing collection tubes and placing a bandage. There is a requirement for a human to supervise the robot, with a maximum of three robots per human. 
  • While not involving a robot, Abiomed reported a problem with a component in their Impella catheters that has led to 37 patient injuries and three patient deaths. 
    • As a reminder, the demise of the Medicare Inpatient-Only list is coming, which will eliminate automatic Inpatient payment for complex cardiovascular procedures like the use of Impella.  
    • There was a recent publication in the New England Journal of Medicine which showed that the use of Impella in high-risk, planned, complex stenting didn’t result in any clinical benefits. Medicare and other payers will likely be watching closely for other studies supporting this conclusion so they can stop paying for Impella use.  
  • Oregon state Medicaid regulation includes the following clause: “A maximum of 48 hours of outpatient observation shall be reimbursed. An outpatient observation stay that exceeds 48 hours shall be billed as inpatient.” 
    • Because of this, and similar to the Medicare intent-to-admit policy, Oregon hospitals can be reimbursed at the Inpatient rate for Medicaid patients even without admitting them as Inpatients. The state regulations also state that Managed Medicaid plans must follow all Medicaid regulations, meaning that those plans must also follow this rule.
    • If you’re in Oregon and this is news to you, speak with your compliance and billing teams to operationalize this process and ensure your hospital is reimbursed appropriately.
    • When’s the last time you perused your state’s Medicaid regulations?  Perhaps it’s time to give them another look. If you find this or a similar regulation in your state, let us know by emailing the American College of Physician Advisor at [email protected]so the information can be shared in a future edition of News to Note.