Health Plan Policy Errs About CMS Two-Midnight Rule

Contrary to the belief of some, the rule remains alive and well.

EDITOR’S NOTE: The rumor mill was churning recently regarding news from a Wisconsin health plan that reportedly was discontinuing adherence to the contentious two-midnight rule of the Centers for Medicare & Medicaid Services (CMS), believing that CMS was, too.

Sometimes, a simple question can open a door to what feels like The Twilight Zone. This happened to me late last week when I received an update from my health system’s contracting office. 

Earlier in the week, I had asked my contact in the office to investigate if any of our contracted managed Medicare plans had updated policies supporting use of the two-midnight rule. It wasn’t likely, but I figured we might as well make sure nothing had come up recently. While plans regularly send us policy updates, they are often convoluted, and it can be difficult to recognize important changes. 

Her reply a couple of days later indicated that some plans had replied that no, they were not following the Medicare two-midnight rule. Others she was still waiting to hear back from, but one in particular, Security Health Plan, responded with a link from their administrative manual: 

Their policy, titled “Two Midnight Rule,” which was “last updated on January 24, 2019,” made my jaw drop at the first sentence:

“In line with the recent Centers for Medicare & Medicaid Services suspension of the two-midnight rule, effective immediately, Security Health Plan will also suspend implementation of this rule.”

What’s that, now? For a brief moment, I thought perhaps I was not the well-informed physician advisor I thought I was. Quickly, I dismissed that thought, deciding that there was no way I could have missed such a major development as CMS’s abandoning the two-midnight rule. What the heck was going on? 

I called the 800 number listed in the policy to address questions, and eventually, I was connected with the individual who originally sent the link in response to my contracting office’s question. “CMS never suspended the two-midnight rule,” I said. “What’s this policy about?” 

While the individual on the other line was unable to answer my questions, I was told someone else would call me back to discuss.

While waiting, I looked around the plan’s website and learned a bit about the payor. Originally founded in 1971 as the Greater Marshfield Community Health Plan, in 1986 it evolved into Security Health Plan, and it is now part of the Marshfield Clinic Health System in Wisconsin. They describe themselves as “a not-for-profit health maintenance organization” offering “a variety of health-insurance options for employer groups and individuals and families of all ages and income levels.”

I called back after the weekend passed and asked when I might be able to speak to someone who had knowledge about the creation of the policy. I was told that someone would call me back later in the day if they could, but I ended up getting another call from my original contact. 

Unfortunately, the policy folks didn’t have time to discuss the situation, but they wanted to pass along the message that “CMS was going back and forth about continuing the two-midnight rule, and we at Security Health Plan decided we would not follow (it).” I responded that this was not the case; CMS had never recently indicated it was considering abandoning the two-midnight rule. This was met with assurance that my point would be passed along.

I’ve come away from this experience without any good answers. But I will close with noting that boy, this subject matter is challenging! And not just for patients, hospital administrators, case management staff, and providers. Clearly, even health insurance plans can become mixed up! Because in all honesty, I truly believe this policy was the result of an honest mistake. Someone, somewhere within the plan found a confounding and cryptic communication from CMS and misunderstood what they read. From there, decisions were made and posted as policy. 

I get it. We all get it. I just hope they make the adjustment online soon, so others don’t become similarly confused. 

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Juliet Ugarte Hopkins, MD, ACPA-C

Juliet B. Ugarte Hopkins, MD, ACPA-C is Chief Medical Officer of Phoenix Medical Management, Inc. and Past President of the American College of Physician Advisors. Dr. Ugarte Hopkins practiced as a pediatric hospitalist for a decade and then developed the physician advisor role for case management, utilization, and clinical documentation at a three-hospital health system where she worked for nearly another decade. She is a member of the MedLearn Media editorial board, author, and national speaker.

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