Utilization review and denials glossary

Traditional Medicare's requirement of at least three consecutive inpatient days before it covers skilled nursing facility care. Observation days don't count.

Two separate rules: a critical access hospital's annual average acute inpatient stay must be 96 hours or less, and a physician must certify that each inpatient can reasonably be expected to be discharged or transferred within 96 hours.

The third level of Medicare appeal, held by the Office of Medicare Hearings and Appeals. It must be requested within 60 days of the reconsideration decision and requires a minimum amount in dispute.

A physician's order to admit a patient as an inpatient. Inpatient status begins when the order is written; it can't be backdated.

An exception to the Two-Midnight Rule that lets the admitting physician order inpatient care for a shorter expected stay, based on documented clinical factors such as history, severity of illness and risk.

A denial based on medical necessity or level of care, such as a payer saying an inpatient stay should have been observation. Different from a technical or administrative denial, such as a missing authorization.

Work that makes sure the medical record accurately reflects the patient's condition and care, usually through reviews and physician queries.

Utilization review done while the patient is still in the hospital, so status and level of care can be corrected in time.

The billing code used when a hospital changes a Medicare patient from inpatient to outpatient before discharge. A physician member of the utilization review committee and the attending physician must agree, and the change must be documented and the patient informed.

A Medicare designation for small, usually rural hospitals with up to 25 inpatient beds and an annual average acute length of stay of 96 hours or less.

The typical length of stay Medicare expects for a given MS-DRG. Hospitals use it to spot stays that run unusually long.

A required notice explaining a Medicare inpatient's discharge appeal rights, given within 2 days of admission and again no more than 2 days before discharge.

Procedures Medicare only pays for when done as an inpatient, regardless of the expected length of stay.

A widely used set of commercial screening criteria for medical necessity and level of care, used by hospitals and payers.

A widely used set of evidence-based care guidelines (formerly Milliman Care Guidelines), used by hospitals and payers to screen medical necessity and level of care.

Whether care is reasonable and needed to diagnose or treat a patient's condition, and provided at the right level of care. Most clinical denials turn on it.

The private contractor that processes Medicare claims for a region and handles the first level of appeal (redetermination).

Medicare coverage provided through private health plans (Part C). Since January 1, 2024, these plans must follow traditional Medicare's inpatient admission criteria, including the Two-Midnight Rule.

A required notice telling a Medicare patient they are an outpatient receiving observation services, and what that means for their costs. Required after more than 24 hours of observation, no later than 36 hours after it begins.

Medicare Severity Diagnosis Related Group: the category that sets Medicare's fixed inpatient payment for a stay, based on diagnoses, procedures and complications.

An outpatient service, billed under Medicare Part B, used to decide whether a patient needs to be admitted. In most cases the decision should be made within 24 to 48 hours.

A call between the treating or advising physician and a payer's medical director to discuss a denial or pending adverse decision.

A physician who helps a hospital make and defend status and medical necessity decisions through case review, peer-to-peer calls, appeals and documentation education.

Payer approval required before certain services are provided. Missing it usually leads to a technical denial.

The independent contractor that handles the second level of Medicare appeal (reconsideration).

The second level of Medicare appeal, decided by a Qualified Independent Contractor and requested within 180 days of the redetermination decision.

A Medicare contractor that reviews paid claims after the fact to find and recover improper payments.

The first level of Medicare appeal, decided by the Medicare Administrative Contractor and requested within 120 days of the initial determination.

Utilization review done after the patient is discharged, often to prepare appeals or check status decisions before billing.

A hospital bed that can be used for either acute care or skilled nursing care. Medicare coverage for skilled care in a swing bed generally needs a qualifying 3-day inpatient stay.

A Medicare review policy: inpatient stays that cross two midnights after the admission order are generally presumed appropriate and aren't a focus of contractor medical review.

Medicare's guideline that inpatient admission is generally appropriate when the admitting physician reasonably expects medically necessary hospital care spanning at least two midnights.

The process of checking that hospital care is medically necessary and provided at the right level of care and status, before, during or after the stay.

A hospital committee, including physicians, that oversees utilization review and approves decisions such as Condition Code 44 status changes.