March 9, 2017

Does the MOON Violate HIPAA?

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Last week RACmonitor released a special bulletin on the latest guidance from the Centers for Medicare & Medicaid Services (CMS) on the Medicare Outpatient Observation Notice (MOON). That guidance was presented in an open door forum call, and it caught many off guard. The Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act was signed into law 578 days ago, and CMS waited until nine days before its deadline to tell hospitals that they must indicate “the clinical rationale that is specific to each beneficiary’s circumstances” in the box to indicate why he or she is not being admitted as inpatient. This question was posed to CMS at previous open door forums, and by email, and they knew that hospitals needed this information to finalize their MOON delivery process – yet they waited to release this, and didn’t even deliver it in writing. CMS was then asked for examples of what they expect to see, and they refused to say. So it appears that we have to wait until a hospital gets surveyed and cited to find out what is expected.

Since that open door forum call, there has been a lot of discussion on user forums about how to interpret this. Many have pointed out that the MOON instructions only require a “specific reason,” and the NOTICE Act and manual instructions specify only the “reason” a patient is not an inpatient. Therefore, since none of these written documents specifically require a “clinically specific reason,” and being that information given during an open door forum call is not official guidance, some providers apparently will not be putting in any clinical reason and will only use a checkbox indicating expected length of stay. One person suggested using wording such as “your physician is working hard to fully evaluate all the information regarding the medical condition(s) that caused you to seek assistance. At the present time, there is not enough medical evidence to suggest that your condition(s) will require you to remain in the hospital for an extended period of time.” The argument would be that this is specific to the patient, since it mentions “the condition that caused” the patient to seek assistance.

What is the right answer? David Glaser, a lawyer, member of the RACmonitor Editorial Board, and Risky Business segment presenter on Monitor Mondays, noted during his last Risky Business report that if a single phrase was applicable to all patients, then CMS would not have designed the form with a box that requires completion. In fact, the first iteration of the MOON did not have such a box, but rather stated, “you are not an inpatient. Observation services are given to help your doctor decide if you need to be admitted as an inpatient or discharged, are (taken to) the emergency department or another area of the hospital, and usually (such services) last 48 hours or less.” This version was ultimately modified by CMS after it received comments asking that the MOON contain an area to indicate the “specific reason.”

Glaser seemed to feel that my suggested phrasing – which states, “you require hospital care for evaluation and/or treatment of ______________ (fill in chief complaint). It is expected that you will need hospital care for less than a total of two days” – seems to meet the new guidance, since that reason is specific to that patient. However, in no way should any hospital consider that to be a formal legal opinion or an endorsement. Each hospital must consult with its compliance staff and legal counsel and determine the best approach based on the available information. I would also encourage any hospital that does get surveyed to share the comments of their surveyors with others so we all can adapt in our practices.

What can hospitals expect when they start using the MOON? Sherri Ernst at Covenant Health in Knoxville, Tenn. told me they are already providing the MOON, and the average time to prepare and deliver the form is 20 minutes. Half the patients got upset about it, one threatened to leave, and about 10 percent needed someone else to contact them to answer questions. Covenant Health even ran an ad in the local paper explaining observation services to the community and developed a separate handout to give with the MOON.

The fact that we are required to provide yet another form to patients who are already overwhelmed with paperwork was noted by Doug Zellmer of SSM Health, who suggested to CMS that they next require a second notice when an observation patient is admitted as inpatient. He’d call it the Status Upgraded Now notice, abbreviated the SUN. The SUN notice could then join the MOON. But would we need to have two SUNs, like the planet Tatooine, the home of Luke Skywalker, since critical access hospitals have different payment rules?

I still have my request for the Hospital Outpatient Time Ending Liability (HOTEL) Notice, notifying patients that further hospital care is convenience care and not medically necessary, awaiting action at CMS. So I don’t think we will see the SUN any time soon.

And there may be another issue with this new MOON requirement. Rebecca Benson at Samaritan Health in Corvallis, Ore. astutely pointed out that the need for a clinical reason on a payment and coverage document may violate the HIPAA requirement that documents contain only the minimum necessary information. I am not a HIPAA expert, but I have notified CMS of this concern (but have received no response from them yet). I do wonder if the government can fine itself for a HIPAA violation.

The MOON saga is far from over; I am sure more issues will arise once all hospitals roll it out and once patients start asking questions and filing complaints. We’ll do our best at RACmonitor to keep you informed.

Ronald Hirsch, MD, FACP, CHCQM

Ronald Hirsch, MD, FACP, CHCQM is vice president of the Regulations and Education Group at R1 Physician Advisory Services. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices and is a published author on the topic. He is a member of the Advisory Board of the American College of Physician Advisors, a member of the American Case Management Association, and a Fellow of the American College of Physicians. Dr. Hirsch is a member of the RACmonitor editorial board and is regular panelist on Monitor Monday.

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