THE CHALLENGE
Many hospitals and health systems have been forced to navigate a new payer tactic that does not result in a formal denial of inpatient (IP) level of care (LOC). Instead, the payer affirms that IP admission was medically necessary, but reimbursement is reduced due to a perceived lack of severity for the billed LOC. The payer is not disputing the need for IP admission but is instead adjusting payment.
This creates a significant challenge and potential confusion for revenue cycle and utilization management teams. Because the payer is not issuing a formal denial, these cases may be misinterpreted as contractual adjustments rather than clinical determinations subject to appeal. This adds yet another obstacle that hospitals must face in getting paid for care that they provide.
An AppriseMD client recently encountered this scenario following a multi-day hospitalization for a breast cancer patient with postoperative complications, resulting in the hospital referring the case to AppriseMD for further review and escalation.
THE SOLUTION
AppriseMD promptly coordinated a review with the payer after receiving the request related to a LOC payment determination. At the time of referral, the hospital provided the payer’s authorization documentation, which indicated that the IP admission had been approved, but reimbursement had been assigned at a lower level based on the payer’s assessment of documented intensity of service. The payer’s determination reflected an internal utilization management review in which payment was aligned with perceived resource utilization rather than the full clinical complexity of the case.
AppriseMD initiated a focused clinical review and escalation process, preparing for a physician-to-physician discussion centered on validating the intensity of service, clinical risk, and need for IP LOC reimbursement at the full expected amount as supported by the medical record.
LEVEL OF SEVERITY CASE STUDY SUMMARY
A patient with a past medical history significant for bilateral breast cancer, blood clotting disorder with prior PE, CKD, and obesity (BMI 43.60) was hospitalized four days after undergoing a bilateral lumpectomy with sentinel lymph node biopsy. She initially presented to her postoperative clinic visit with severe swelling and bruising at the right lumpectomy site and was found to have a large hematoma, which was drained in the office. The hematoma subsequently reaccumulated, and the patient had an associated fever and tachycardia, and a continued downward trend in hemoglobin. She was admitted to the hospital and underwent evacuation of a large recurrent hematoma of the right breast and re-excision of tissue due to positive margins on pathology. The patient tolerated the procedure well; however, her hemoglobin continued to decline postoperatively, requiring close monitoring for bleeding and careful management of anticoagulation while transitioning Lovenox from prophylactic to therapeutic dosing. Hemoglobin levels ultimately stabilized and the patient was safely discharged.
SEVERITY DISCUSSION OUTCOME
An AppriseMD physician advisor conducted the severity discussion with the payer medical director. The physicians discussed details of the case involving a significant post lumpectomy large hematoma requiring urgent admission for surgical washout. The AppriseMD physician advisor reminded the payer medical director that the patient underwent resection of tissue due to positive margins on pathology and that 400 mL of dark blood, seroma, and clot were evacuated during the procedure. Adding to the severity of the case was the patient’s Hgb levels which were 9.6 on admission (from a presurgical baseline > 13) and trended downwards to 8.6 on day two of hospitalization. This required close monitoring and a slow start on the initial prophylactic dose of Lovenox, which transitioned to a therapeutic dose the following day with continued monitoring of Hgb levels and signs of bleeding.
The preparation and skill of the AppriseMD physician advisor was recognized when the payer medical director agreed that the second surgery, close monitoring, and potential for active hemorrhage warranted a higher level of severity reimbursement. This resulted in the hospital receiving their expected IP payment, without a reduction.
ABOUT APPRISEMD
AppriseMD provides denial management and physician advisory solutions to help hospitals and health systems optimize the revenue cycle with data transparency and operational efficiency.