text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Two-Midnight Rule Coordination and 
  Improvement Act of 2014''.
  
  SEC. 2. DEVELOPMENT OF CRITERIA FOR MEDICALLY NECESSARY SHORT INPATIENT 
                HOSPITAL STAYS.
  
      (a) In General.--
              (1) Development of criteria.--The Secretary shall develop 
          appropriate criteria with regard to the two-midnight rule (as 
          defined in subsection (e)) for payment under the Medicare 
          program under title XVIII of the Social Security Act (42 U.S.C. 
          1395 et seq.) for a short inpatient hospital stay (as defined 
          in such subsection).
              (2) Requirements.--The criteria developed under paragraph 
          (1) shall--
                      (A) account for medical necessity and the 
                  appropriateness of an inpatient stay that is less than 
                  the two-midnight benchmark; and
                      (B) subject to paragraph (3), be developed in 
                  consultation with interested stakeholders.
              (3) Implementation.--The consultation described in 
          paragraph (2)(B) shall be conducted as part of the annual 
          notice and comment rulemaking process implementing the Medicare 
          hospital inpatient prospective payment system for fiscal year 
          2015.
      (b) Development of Short Inpatient Hospital Stay Payment 
  Methodology.--
              (1) In general.--The Secretary shall develop a payment 
          methodology under the Medicare program under title XVIII of the 
          Social Security Act for hospitals for short inpatient hospital 
          stays. Such methodology--
                      (A) shall be implemented in a budget neutral 
                  manner;
                      (B) may be a reduced payment amount for such 
                  inpatient hospital services than would otherwise apply 
                  if paid for under section 1886(d) of the Social 
                  Security Act (42 U.S.C. 1395ww(d)) or be an alternative 
                  payment methodology; and
                      (C) shall take into consideration the criteria 
                  developed under subsection (a).
              (2) Timeframe.--The Secretary shall promulgate such 
          methodology as part of the annual regulations implementing the 
          Medicare hospital inpatient prospective payment system for 
          fiscal year 2015.
      (c) Crosswalk of ICD-10 Codes and CPT Codes; Crosswalk of DRG and 
  CPT Codes.--
              (1) ICD-10-to-CPT crosswalk.--
                      (A) In general.--Not later than 2 years after the 
                  date of the enactment of this Act, the Secretary shall 
                  develop general equivalency maps (referred to in this 
                  subsection as ``crosswalks'') to link the relevant ICD-
                  10 codes to relevant CPT codes, and the relevant CPT 
                  codes to relevant ICD-10 codes, in order to permit 
                  comparisons of inpatient hospital services, for which 
                  payment is made under section 1886 of the Social 
                  Security Act (42 U.S.C. 1395ww), and hospital 
                  outpatient department services, for which payment is 
                  made under section 1833(t) of such Act (42 U.S.C. 
                  1395l(t)). In this subsection the terms ``ICD-10 
                  codes'' and ``CPT codes'' include procedure as well as 
                  diagnostic codes.
                      (B) Process.--
                              (i) In general.--In carrying out 
                          subparagraph (A), the Secretary shall develop a 
                          proposed ICD-10-to-CPT crosswalk which shall be 
                          made available for public comment for a period 
                          of not less than 60 days.
                              (ii) Notice.--The Secretary shall provide 
                          notice of the comment period through the 
                          following:
                                      (I) Publication of notice of 
                                  proposed rulemaking in the Federal 
                                  Register.
                                      (II) A solicitation posted on the 
                                  Internet Web site of the Centers for 
                                  Medicare & Medicaid Services.
                                      (III) An announcement on the 
                                  Internet Web site of the Centers for 
                                  Medicare & Medicaid Services of the 
                                  availability of the proposed crosswalk 
                                  and the deadline for comments.
                                      (IV) A broadcast through an 
                                  appropriate Listserv operated by the 
                                  Centers for Medicare & Medicaid 
                                  Services.
                              (iii) Use of the icd-9-cm coordination and 
                          maintenance committee.--The Secretary also 
                          shall instruct the ICD-9-CM Coordination and 
                          Maintenance Committee to convene a meeting to 
                          receive input from the public regarding the 
                          proposed ICD-10-to-CPT crosswalk.
                              (iv) Publication of final crosswalks.--
                          Taking into consideration comments received on 
                          the proposed crosswalk, the Secretary shall 
                          publish a final ICD-10-to-CPT crosswalk under 
                          subparagraph (A) and shall post such crosswalk 
                          on the Internet Web site of the Centers for 
                          Medicare & Medicaid Services.
                              (v) Updating.--The Secretary shall update 
                          such crosswalk on an annual basis.
              (2) DRG-to-APC crosswalk.--
                      (A) In general.--The Secretary shall, using the 
                  ICD-10-to-CPT crosswalk developed under paragraph (1), 
                  develop a second crosswalk between diagnosis-related 
                  group (DRG) codes for inpatient hospital services and 
                  Ambulatory Payment Class (APC) codes for outpatient 
                  hospital services.
                      (B) Data to be used.--In developing such crosswalk, 
                  the Secretary shall use claims data for inpatient 
                  hospital services for discharges occurring in fiscal 
                  years beginning with fiscal year 2015 and for 
                  outpatient hospital services furnished in years 
                  beginning with 2015.
                      (C) Publication.--Not later than June 30, 2017, the 
                  Secretary shall publish the DRG-to-APC crosswalk 
                  developed under this paragraph.
      (d) Delay of Enforcement of the Two-Midnight Rule.--
              (1) In general.--The Secretary shall not enforce the 
          provisions of the two-midnight rule with respect to admissions 
          to a hospital for which payment is made under the Medicare 
          program under title XVIII of the Social Security Act--
                      (A) for admissions occurring before October 1, 
                  2014; and
                      (B) in the case of admissions occurring on or after 
                  October 1, 2014, prior to the applicable date (as 
                  defined in paragraph (3)).
              (2) Application to medicare review contractors.--Paragraph 
          (1) shall also apply to Medicare review contractors (as defined 
          in subsection (e)). No Medicare review contractor may, based on 
          the provisions of the two-midnight rule, deny a claim for 
          payment for inpatient hospital services furnished by a 
          hospital, or inpatient critical access hospital services 
          furnished by a critical access hospital, for which payment may 
          be made under title XVIII of the Social Security Act for 
          discharges occurring before the applicable date (as defined in 
          paragraph (3))--
                      (A) for medical necessity due to the length of an 
                  inpatient stay in such hospital or due to a 
                  determination that the services could have been 
                  provided on an outpatient basis; or
                      (B) for requirements for orders, certifications, or 
                  recertifications, and associated documentation relating 
                  to the matters described in subparagraph (A).
              (3) Applicable date defined.--In this subsection, the term 
          ``applicable date'' means the earlier of--
                      (A) the date on which the criteria described in 
                  subsection (a) are implemented pursuant to subsection 
                  (a)(3); or
                      (B) October 1, 2015.
              (4) Continuation of medicare probe and educate program for 
          inpatient hospital admissions.--
                      (A) In general.--Subject to subparagraph (B), 
                  nothing in this subsection shall be construed to 
                  preclude the Secretary from continuing the conduct by 
                  Medicare administrative contractors of the Medicare 
                  Probe and Educate program (as defined in subparagraph 
                  (C)) for hospital admissions during the delay of 
                  enforcement under paragraph (1).
                      (B) Maintenance of sample prepayment record 
                  limits.--The Secretary may not increase the sample of 
                  claims selected for prepayment review under the 
                  Medicare Probe and Educate program above the number and 
                  type established by the Secretary under such program as 
                  of November 4, 2013, such as 10 claims for most 
                  hospitals and 25 claims for large hospitals.
                      (C) Medicare probe and educate program defined.--In 
                  this paragraph, the term ``Medicare Probe and Educate 
                  program'' means the program established by the 
                  Secretary as in effect on November 4, 2013 (and 
                  described in a public document made available by the 
                  Centers for Medicare & Medicaid Services on its Web 
                  site entitled ``Frequently Asked Questions 2 Midnight 
                  Inpatient Admission Guidance & Patient Status Reviews 
                  for Admissions on or after October 1, 2013''), under 
                  which Medicare administrative contractors--
                              (i) conduct prepayment patient status 
                          reviews for inpatient hospital claims with 
                          dates of admission on or after October 1, 2013, 
                          and before March 31, 2014; and
                              (ii) based on the results of such 
                          prepayment patient status reviews, conduct 
                          educational outreach efforts during the 
                          following 3 months.
      (e) Definitions.--In this section:
              (1) Hospital.--The term ``hospital'' means the following 
          (insofar as such terms are used under title XVIII of the Social 
          Security Act):
                      (A) An acute care hospital.
                      (B) A critical access hospital.
                      (C) A long-term care hospital.
                      (D) An inpatient psychiatric facility.
              (2) Interested stakeholders.--The term ``interested 
          stakeholders'' means the following:
                      (A) Hospitals.
                      (B) Physicians
                      (C) Medicare administrative contractors under 
                  section 1874A of the Social Security Act (42 U.S.C. 
                  1395kk-1).
                      (D) Recovery audit contractors under section 
                  1893(h) of such Act (42 U.S.C. 1395ddd(h)).
                      (E) Other parties determined appropriate by the 
                  Secretary.
              (3) IPPS fy 2014 final rule.--The term ``IPPS FY 2014 Final 
          Rule'' means the final rule (CMS-1599-F, CMS-1455-F) published 
          by the Centers for Medicare & Medicaid Services in the Federal 
          Register on August 19, 2013, entitled ``Medicare Program; 
          Hospital Inpatient Prospective Payment Systems for Acute Care 
          Hospitals and the Long-Term Care Hospital Prospective Payment 
          System and Fiscal Year 2014 Rates; Quality Reporting 
          Requirements for Specific Providers; Hospital Conditions of 
          Participation; Payment Policies Related to Patient Status'' (78 
          Fed. Reg. 50496 et seq.).
              (4) Medicare review contractor.--The term ``Medicare review 
          contractor'' means any contractor or entity that has entered 
          into a contract or subcontract with the Centers for Medicare & 
          Medicaid Services with respect to the Medicare program to 
          review claims for items and services furnished for which 
          payment is made under title XVIII of the Social Security Act, 
          including--
                      (A) Medicare administrative contractors under 
                  section 1874A of the Social Security Act (42 U.S.C. 
                  1395kk-1); and
                      (B) recovery audit contractors under section 
                  1893(h) of such Act (42 U.S.C. 1395ddd(h)).
              (5) Secretary.--The term ``Secretary'' means the Secretary 
          of Health and Human Services.
              (6) Short inpatient hospital stay.--The term ``short 
          inpatient hospital stay'' means, with respect to an inpatient 
          admission of an individual entitled to benefits under part A of 
          title XVIII of the Social Security Act to a hospital, a length 
          of stay that is less than the length of stay required to 
          satisfy the 2-midnight benchmark described in section 412.3 of 
          title 42, Code of Federal Regulations, as amended under the 
          amendment 2 referred to in paragraph (7)(A).
              (7) Two-midnight rule.--The term ``two-midnight rule'' 
          means the following numbered amendments to 42 CFR Chapter IV 
          contained in the IPPS FY 2014 Final Rule (and includes any sub-
          regulatory guidance issued in the implementation of such 
          amendments and any portion of the preamble of section XI.C. of 
          such rule relating to such amendments):
                      (A) Amendment 2 (on page 50965), which adds a 
                  section 412.3 of title 42, Code of Federal Regulations 
                  (relating to admissions).
                      (B) Amendment 3 (on page 50965), which revises 
                  section 412.46 of such title (relating to medical 
                  review requirements).
                      (C) Amendment 23 (on page 50969), which amends 
                  paragraphs (d) and (e)(2) of section 424.11 of such 
                  title (relating to conditions of payment: General 
                  procedures).
                      (D) Amendment 24 (on pages 50969 and 50970), which 
                  revises section 424.13 of such title (relating to 
                  requirements for inpatient services of hospitals other 
                  than inpatient psychiatric facilities).
                      (E) Amendment 25 (on page 50970), which revises 
                  paragraphs (a), (b), (d)(1), and (e) of section 424.14 
                  of such title (relating to requirements for inpatient 
                  services of inpatient psychiatric facilities).
                      (F) Amendment 26 (on page 50970), which revises 
                  section 424.15 of such title (relating to requirements 
                  for inpatient CAH services).
target: Two-Midnight Rule Coordination and Improvement Act of 2014 - Directs the Secretary of Health and Human Services (HHS) to develop appropriate criteria with regard to the two-midnight rule for payment under title XVIII (Medicare) of the Social Security Act for a short inpatient hospital stay. (The two-midnight rule allows Medicare coverage of only hospital stays for which a physician admits to a hospital a beneficiary expected to require care that crosses two midnights, but generally denies coverage of care expected to require less than a two-midnight stay.) Requires the criteria developed by the Secretary to: (1) account for medical necessity and the appropriateness of an inpatient stay that is less than the two-midnight benchmark, and (2) be developed in consultation with interested stakeholders. Directs the Secretary to develop a budget-neutral Medicare payment methodology for hospitals for short inpatient hospital stays. Allows the methodology to be: (1) a reduced payment amount than would otherwise apply to inpatient hospital services if paid for under the Medicare prospective payment schedule, or (2) an alternative payment methodology. Directs the Secretary to develop: (1) general equivalency maps to link the relevant International Statistical Classification of Diseases and Related Health Problems (ICD)-10 codes (used to report medical diagnoses and inpatient procedures) to relevant Current Procedural Terminology (CPT) codes, and the relevant CPT codes to relevant ICD-10 codes, in order to permit comparison of inpatient hospital services and hospital outpatient department services; and (2) a second crosswalk between Diagnosis-Related Group (DRG) codes for inpatient hospital services and Ambulatory Payment Class (APC) codes for outpatient hospital services. Prohibits the Secretary from enforcing the two-midnight rule for admissions occurring: (1) before October 1, 2014; and (2) on or after that date until October 1, 2015, or the new two-midnight rule criteria are implemented, if sooner (applicable date). Prohibits a Medicare review contractor from denying a claim for inpatient hospital services furnished by a hospital, or inpatient critical access hospital services furnished by a critical access hospital, on the basis of the two-midnight rule for discharges occurring before the applicable date for: (1) medical necessity due to the length of an inpatient stay in such hospital or due to a determination that the services could have been provided on an outpatient basis; or (2) requirements for orders, certifications, or recertifications, and associated documentation relating to such matters. Declares that nothing in this Act shall be construed to preclude the Secretary from continuing the conduct by Medicare administrative contractors of the Medicare Probe and Educate program for hospital admissions during the delayed enforcement of the two-midnight rule.  Prohibits the Secretary from increasing the sample of claims selected for prepayment review under the Medicare Probe and Educate program above the number and type established by the Secretary as of November 4, 2013, such as 10 claims for most hospitals and 25 claims for large hospitals.
feat_title: Two-Midnight Rule Coordination and Improvement Act of 2014