Case Management Corner: Social Workers Essential for Ensuring Cultural Competence

By Kelly Bilodeau

When a patient comes into a hospital, they don’t come alone. They bring ideas, values, and cultural traditions that often play a major role in their health.

As the nation becomes increasingly diverse, understanding these factors is more critical than ever because they strongly influence health outcomes. Black, American Indian, and Alaska Native patients, for example, are much more likely to die from diseases such as cancer and diabetes than white Americans, according to KFF. These poor outcomes are not only a concern at the patient level but also for the overall health system. One study estimates that in 2018 alone, the economic burden from health inequities among ethnic minorities cost as much as $451 billion annually.

Case managers are on the front lines in the effort to reduce health inequities, but they’re also under pressure to discharge patients quickly, leaving little time to fully address these cultural factors, said Kalie Wolfinger, manager of clinical services at Phoenix. Support from social workers can help close that gap.

“Social workers are trained to understand patients as whole people, including their cultural identity, language access needs, beliefs about illness, and family roles,” she said. “While medical teams focus on treatment, social workers ensure the care plan is realistic and respectful of how the patient lives.”

Recent research reinforces this role, showing that innovative case management models led by social workers succeed by strengthening coordination between team members and improving equity, efficiency, and patient engagement. Having this support is crucial because organizations are increasingly being held accountable for providing culturally competent care. In 2023, the Joint Commission introduced six new elements of performance in its Leadership chapter, making the reduction of health care disparities a “quality and safety priority.” To this end, the Culturally and Linguistically Appropriate Standards from the Office of Minority Health offer a blueprint for organizations seeking to improve cultural competence.

What cultural competence means in case management

A patient’s culture encompasses many elements, from religion, language, and immigration experience to beliefs about medicine, gender identity, and family structure. Cultural competence in medicine is about more than just being aware of these differences.

“It means providing care that works for someone in the context of their culture. It affects how we complete psychosocial assessments, how we communicate with loved ones, and how we support discharge planning,” Wolfinger said.

The National Association of Social Workers Standards for Cultural Competence support this perspective, she said. They examine how cultural competence shows up in patient interactions and how professionals understand and address issues that affect patient health.

Understanding the patient’s culture starts with the initial assessment, ideally conducted in the patient’s preferred language. While translators are often in short supply, it’s best to seek professional services whenever possible rather than rely on family members, who can muddy interactions with their own emotions and beliefs. Discussions can also be colored by the interviewer’s personal experiences and biases, so experts recommend approaching conversations with cultural humility, allowing the patient to take the lead in explaining their beliefs and preferences. While much of the discussion will naturally center on medical issues, these conversations should also explore other factors that can affect care, such as spiritual or traditional healing practices, which should be built into the medical plan, Wolfinger said.

Consider the case of a Spanish-speaking heart-failure patient named Maria, who is scheduled to be discharged home from the hospital into the care of her adult children. Through her assessment, the medical team learns that Maria not only takes physician-prescribed medications but also incorporates traditional healing practices. The medical team now knows that instructions should be written in Maria’s native language to ensure comprehension, and the case manager must understand the alternative remedies she uses to protect against dangerous interactions with her prescribed medications.

By taking the time to learn about a patient’s culture, social workers can build crucial bridges between them and the medical team. “They see the full system around the patient and often recognize barriers that others miss,” Wolfinger said.

Overcoming barriers

However, while providing culturally competent care might appear easy on paper, there are major implementation barriers to overcome, including interpreter shortages, personal biases, and a fast-paced hospital environment that often leaves insufficient time for true cultural exploration. Hospital structures frequently prioritize efficiency over individual needs.

“Social workers are critical, because they can identify and push back on harmful patterns,” Wolfinger said.

Despite these barriers, the path to better care is possible if organizations prioritize the following:

• Providing care that includes cultural needs from the start.

• Involving families and communities in supporting the patient’s unique needs.

• Ensuring that information is available to patients in their preferred language.

• Prioritizing both medical and cultural factors when creating a discharge plan.

These priorities align closely with the National CLAS standards, and organizations can support these efforts by designating care coordinators who specialize in cultural needs or by implementing hospital dashboards that track equity outcomes and other metrics related to cultural competence, Wolfinger said.

Ultimately, making this shift requires work. Organizations can benefit from consultants or experts who can help build cultural humility into training and hiring, strengthen interpreter policies, and evaluate organizational outcomes for remaining disparities.

“Hospitals that want to succeed in equity and performance goals must improve cultural competence in case management. Social workers are positioned to lead this work,” Wolfinger said.

Case Management Corner is your go-to source for insightful discussions on relevant topics in case management. Through an engaging interview-style format, our team members share their expertise, experiences, and best practices to keep you informed and empowered. Whether you're looking for industry updates, practical strategies, or real-world perspectives, we bring you valuable conversations designed to enhance your knowledge and support your professional growth. Stay tuned for expert insights straight from the field! Kelly Bilodeau has been a longtime writer for HCPro’s Case Management Monthly. 

Hospitals Brace for Food, Coverage, and Workforce Interruptions Fallout

By Tiffany Ferguson, LMSW, CMAC, ACM

As the federal government shutdown persisted past the one-month mark, the collapse of key safety-net supports such as nutrition benefits, health-insurance subsidies, and the disruption of pay for an estimated 1.4 million furloughed or unpaid federal employees has created a social and operation crisis that reaches into every corner of our communities, including healthcare.

According to The Guardian, over 40 million Americans faced impacts from losing Supplemental Nutrition Assistance Program (SNAP) support and marketplace insurance subsidies remain in jeopardy. For hospitals, clinics, and community organizations, this isn’t only an economic headline; it’s a triggering event for escalating food insecurity, medication non-adherence, and deferred care. Federal workers now missing paychecks join the same vulnerable cohort long supported by social programs. Uncertainty for what the future will look like causes undue stress.

The increased financial strain on these households amplifies the challenges faced by healthcare teams that already manage fragile social conditions.  

When federal food-support systems like SNAP go dark, the consequences are immediate. Families ration meals and reduce caloric intake; those managing chronic illnesses like diabetes can decompensate quickly. On such tight margins, individuals are forced to choose between food, shelter, and medications. The absence of basic needs leads to avoidable hospitalizations, prolonged lengths of stay, and readmissions tied to the social determinants of health (SDoH). Hospitals, particularly care management teams, become the last line of defense, absorbing costs, arranging emergency food or pharmacy vouchers, and connecting patients to overstretched community resources.

Simultaneously, the rising cost of healthcare and premiums is a significant risk to push many households into under-insured or uninsured status. Without coverage, more patients postpone care until conditions worsen.

For healthcare organizations, this translates into a payer-mix shift toward self-pay and charity-care cases, increasing bad debt and straining financial-assistance budgets. But the human cost goes beyond balance sheets.

Patients experiencing benefit loss often disengage from preventive or chronic-care management, eroding the continuity of care that providers work tirelessly to maintain.

Despite lack of federal reporting, now is an important time to continue to identify patients affected by benefit loss, furloughs, or food insecurity early in healthcare settings; this should be linked for continued SDoH Z-code reporting and internal management of the impact of community and societal stressors impacting healthcare services. With the renewed focus on readmissions, high-risk transitions should be prioritized; this includes those without access to food or medications.

Collaboration is necessary with our local communities to support, in any way we can, our food banks, public health departments, and housing/shelter agencies through shared response strategies. Additionally, many hospital and healthcare employees may also be impacted by the shutdown and may be facing the same financial stressors as our patients. 

The shutdown exposes how deeply healthcare depends on the social infrastructure around it. Food access, insurance stability, and workforce pay are not peripheral; they are deeply enmeshed in our healthcare system.

As things drag on, hospitals will continue to shoulder both the medical and social fallout. Our path forward requires humanity, leading with empathy and advocacy.

A Physician Advisor’s Plea: Ask More Questions!

By Juliet Ugarte Hopkins, MD, ACPA-C

Can we talk for a moment? As an educator, I’m obligated to insist that there are no stupid questions. As a physician advisor who works with leaders in case and utilization management who have been immersed in and attuned to rules and regulations from the Centers for Medicare & Medicaid Services (CMS) for multiple years, I desperately insist folks ask more questions.

According to the real-time counter I urged Dr. Ronald Hirsch to add to his website years ago, as of this writing, the Medicare Two-Midnight Rule is 4,003 days, 9 hours, 22 minutes, and a few seconds old. A bit less forgiving is the age of the CMS mandate to Medicare Advantage (MA) plans, that they must follow the Two-Midnight Rule, effective Jan. 1, 2024.

But still!

Despite many years and months and countless educational webcasts, articles, and presentations given by experts in the field – many associated with MedLearn Media and the American College of Physician Advisors – people are not just confused, but actively misinformed.

As someone who has developed, refined, and optimized the physician advisor role at multiple hospitals and health systems across the country (the first being my own, when I was recruited into a position that had never before existed), escalating discoveries of poor regulatory advice gives me heartburn. True, Festivus is still two months away, but I need to air out my grievances. It causes me near-physical pain (see aforementioned gastric reflux) to witness very smart people being led down a briar patch of regulatory slight-of-hand while wearing improved reimbursement-tinted glasses.

So, let’s review the top offenses.  I got a lot of problems, and now you’re gonna hear about it!

1. The crux of the Medicare Two-Midnight Rule involves passage or anticipated passage of two midnights in the hospital due to the patient’s need for services that can only be rendered in the hospital setting – not simply the passage of two midnights. Can determination of medical necessity for that second midnight be tricky? Absolutely. This is where physician advisors, exquisite documentation from clinicians, and a realistic eye on outpatient services comes in. For the love of Athena, stop asking for an inpatient order every time hospital day three is approaching. 
   

2. “Difficulty performing activities of daily living” is not a medical condition requiring hospital care. Full stop. Similarly, listing every complaint and mildly abnormal lab value for a patient remaining hospitalized for a second midnight doesn’t support medical necessity of continued hospitalization. Documenting that the “patient will require a second midnight of hospital care for constipation and leukocytosis” does not cut it without further explanation.
   
   Patients are constipated at home every day; what is it about this patient’s condition that requires hospital care? Leukocytosis is an extremely generalized term, without more specificity, about the severity of the increased white blood cell level or suspected reason for the increase. Please do not think inpatient status will be justified by the Medicare Two-Midnight Rule if your physicians document any condition in a patient passing a second midnight.  
   

3. It’s often a fallacy to assert that there’s a higher financial burden for the patient if they’re not discharged in inpatient status. Outpatient hospitalization involving observation services can be less expensive for the patient than an inpatient hospitalization, depending on the circumstances.
   
   The Medicare Part A deductible of $1,676 is the patient’s responsibility for every inpatient hospitalization if more than 60 days have passed. Meanwhile, the Medicare Part B deductible for outpatient hospitalizations (with or without observation services) is $257 and paid only once a year.
   
   Granted, “observation stays” also involve a 20-percent co-pay, but this can still be significantly less than an inpatient hospitalization, considering that the observation services code, APC 8011, is a charge of $2,607.99, which would be just $521.60 for the patient.
   

4. Status can be compliantly changed until the patient’s “discharge is effectuated,” but there’s no CMS definition as to what this means. To equate it with physically leaving the hospital or hospital unit is a squishy assumption, at best. Opinions vary widely, but in general, your marker should be consistent, reliably timed in the chart, and agreed upon by your compliance team.

These common misconceptions and misguidance promise increased hospital margins and case mix index (CMI) but actually wreak havoc on utilization review efforts and lead to massive increases in MA denials. 

Now, then. Who’s up for a wrestling match?

The Perfect Storm of OBBBA and ACA

By Tiffany Ferguson, LMSW, CMAC, AMC

Hospitals are about to hit a perfect storm of two powerful climate conditions set both to hit in 2026; the One Big Beautiful Bill Act (OBBBA) and revisions to the Patient Protection and Affordable Care Act (ACA).

Together, these laws overhaul Medicaid eligibility, Marketplace enrollment, and subsidy structures beginning in 2026 and 2027 fundamentally altering how hospitals manage a growing population expected to have limited to no coverage resulting in uncompensated care and increasing emergency service utilization.

Enacted as Public Law 119-21, the OBBBA represents the largest Medicaid policy reversal in a decade. Its core provisions include:

• Effective January 1, 2027, able-bodied adults aged 19–64 in expansion states must verify at least 80 hours per month of employment, school, or volunteer activity to maintain Medicaid coverage. For reference 40 states and Washington, DC participate in the Medicaid expansion program.

• States must verify eligibility every six months, instead of annually.

• For expansion populations, the retroactive coverage period shrinks from 90 days to 30 days, limiting hospital reimbursement for newly eligible or reinstated patients.

• Certain lawful immigrants, including some refugees and asylees, will lose eligibility.

• Caps on provider taxes are expected to decrease states’ payments to hospitals and providers.

• Enhanced matching funds from the American Rescue Plan Act expire January 1, 2026, removing the incentive for non-expansion states to grow coverage.

• Federal Medicaid funding is suspended for one year from certain nonprofit reproductive health providers, including Planned Parenthood.

According to the AMA, there is an estimated 12–16 million people who are projected to lose coverage nationwide. The highest impact will fall on low-income adults, older pre-Medicare adults, and individuals with disabilities who cannot meet new verification requirements.

Hospitals, particularly rural and safety-net facilities, are anticipated to have an increase in self-pay encounters, charity care cases, and extended inpatient stays. For care management teams, this translates to higher discharge complexity and expanded coordination with community agencies and free clinics who continue to deal with anemic operating margins.

In parallel, revisions to the Affordable Care Act will be tightening enrollment and verification procedures:

• Beginning in 2026, individuals must verify income, citizenship, and household composition before premium subsidies apply.

• Automatic Marketplace plan renewals will end by 2028, requiring manual re-enrollment each year.

• Changes have been made to special enrollment periods and the open enrollment period.

• Advance payments during pending verification will cease; applicants must pay full premiums until eligibility is confirmed.

• Of much political red/blue debate is the temporary subsidies and expanded tax credits set to expire December 31, 2025.

These changes will also increase the uninsured rate, particularly among lower-income workers cycling between Medicaid and Marketplace eligibility.

Why Discharge Planning Eval is the Cornerstone of Case Management

By Tiffany Ferguson, LMSW, CMAC, ACM

Among the many responsibilities of hospital case managers, none is more critical or more impactful than the initial discharge planning evaluation. Often referred to as the case management “initial assessment,” this evaluation sets the foundation for safe, effective, and patient-centered care transitions. It is not merely a regulatory requirement under the Conditions of Participation (CoP); it is the linchpin of the entire case management process.

The initial assessment offers case managers their first opportunity to connect with patients and families at a time when they are often medically fragile, emotionally drained, and overwhelmed by the circumstances of hospitalization. By approaching this encounter with empathy and active listening, case managers can begin to build a trusting, collaborative relationship that becomes the basis for all subsequent planning.

Patients are more likely to share honest concerns, disclose barriers, and participate in their care when they feel heard and supported. This rapport is particularly important when discharge needs change unexpectedly, such as when a patient whose anticipated skilled nursing facility (SNF) is full, and must then decide to go to their second choice, or when the care team elects that a patient would benefit from home health services, but the patient is worried about letting any strangers into their home. A trusting relationship ensures that case managers can navigate these changes with patient and caregiver cooperation, reducing friction at a stressful juncture.

The discharge planning evaluation is designed to capture the clinical, functional, and social factors that influence a safe transition of care. Early identification of risks such as unsafe housing, limited caregiver support, or financial barriers allows the care team to intervene before they become discharge delays or readmission triggers.

For example, a patient may expect to resume independence after surgery, only to discover mobility challenges that mean home discharge may no longer be an immediate option. By uncovering these risks during the initial assessment, the case manager can arrange services, prepare the family, and prevent last-minute crises that compromise both patient safety and hospital throughput.

The initial assessment also serves as the blueprint for the entire hospitalization, from a case management perspective. It outlines anticipated discharge needs, potential barriers, and the resources required to overcome them. This roadmap guides daily progression-of-care discussions, interdisciplinary rounds, and ongoing communication with the patient and family.

Importantly, the assessment is not static. It evolves as the patient’s condition changes, but its early foundation ensures that case managers are not starting from scratch at the point of discharge. Instead, they are continuously refining a plan that reflects the patient’s goals, treatment trajectory, and changing needs.

From a documentation perspective, a strong initial assessment builds the clinical and contextual narrative that supports both patient safety and revenue integrity. The evaluation is where case management identifies anticipated post-discharge needs, potential barriers, and likely service requirements. This documentation is important to the coding team with respect to Centers for Medicare & Medicaid Services (CMS) discharge dispositions and capture of Social Determinants of Health (SDoH) Z-codes.

When discharge needs are identified late, last-minute changes often go undocumented. A patient initially expected to go home may suddenly be discharged to a SNF, but without early evidence of risk factors, demonstrated documentation of choice, or inclusion of the patient and family in the decision-making process, the record can present a compliance and coding risk, creating not only audit vulnerabilities with the CoP, but potentially, reimbursement mismatches related to disposition coding errors.

The discharge planning evaluation is far more than another superfluous task; it is the cornerstone of safe, compliant, and financially sound case management practice. By engaging patients and families early, the case manager not only fosters trust and collaboration during a vulnerable period, but also establishes the clinical and psychosocial framework that drives every subsequent care decision.

A thorough initial assessment ensures that the record accurately reflects the patient’s story, from goals and barriers to available support, which is vital to care team decisions.

When executed well, it aligns the art of compassionate, person-centered care. In short, the discharge planning evaluation is where quality outcomes, patient experience, and case management documentation integrity all begin.

Best Practices for Handling AMA Discharges and Coding Accuracy

By Tiffany Ferguson, LMSW, CMAC, ACM

When a patient leaves the hospital against medical advice (AMA), the discharge is not only a clinical concern, but it can also create coding and compliance challenges. Ensuring the process is clear, consistent, and patient-centered helps protect both patients and providers while supporting accurate coding and revenue cycle integrity.

It should be very clear, as discussed in a Dr. Ronald Hirsch 2021 article on “Leaving Against Medical Advice” that an AMA discharge does not mean that the patient is non-compliant or that the discharge now becomes adversarial. In fact, the care team should still support the patient in their discharge needs with needed prescriptions, any follow up arrangements, and coordination of care needs to balance the patient’s wishes with the physician’s concerns.

In reviewing existing AMA processes, many organizations utilize a process in which the physician and patient identify that the patient’s requested discharging location or desire to leave the hospital is not clinically safe, nursing will provide the patient with an AMA form to be signed. This vital form provides some protection for the hospital and the attending should the patient have an adverse outcome after they decide to leave the hospital, while still preserving the patient’s right to self-determination.

There are other methods to this process, such as incorporating the AMA designation directly into the discharge order. Regardless of the method, however, it must be very clear from a coding and billing standpoint that to ensure the correct discharge, that the status code to be applied. The Patient Discharge Status Code is “07” (Left against medical advice or discontinued care).

The language used in AMA forms is just as important as the documentation itself. Forms should strike a balance between acknowledging patient autonomy and reflecting the care team’s professional recommendations.

For example, rather than presenting the form in a punitive tone, hospitals should consider patient-centered language:

“Your care team only wants the best for you; however, we respect your right to self-determination. This form acknowledges that while your care team recommended discharge to [facility/plan], you have chosen to discharge to [alternative plan].”

This tone emphasizes respect for patient rights while making it clear that the team has offered appropriate guidance. Hospital Patient Advocates and Risk Management teams can be valuable partners in revising these forms.

What Happens if the Patient Returns?

A common concern is whether anything additional is required if a patient who left AMA returns through the emergency department. In short, no new documentation is needed beyond the usual admission process. Coding does not require a unique flag or code for these accounts on readmission. From a readmission penalty perspective these cases are excluded.  However, from a medical necessity and utilization standpoint, acknowledgement of these patients for internal review is still meaningful.

That said, some electronic health record (EHR) systems provide valuable tools. For example, in Epic, the ED tracking board’s “Boomerang” rule identifies all readmissions within a certain time frame. This initiative allows ED UM and CM/SWs to review repeat visits and determine whether the patient truly requires hospital level services for admission or if a different intervention could better address their needs.

From a utilization management perspective, the key question is whether the patient’s return visit meets medical necessity criteria for observation services or inpatient status, regardless of their prior AMA. While the AMA history may inform the clinical discussion, it should not alter the application of CMS guidelines.

Hospitals may find it particularly useful to monitor these cases when AMA discharges involve recommendations for post-acute settings (such as inpatient rehab, SNF, or LTC).

Patients who decline such care and return within 24–48 hours may highlight both quality-of-care and readmission risk issues. This may support the balance for internal quality audits to examine, the question- ‘why are patients not following the care team’s advice?” is it really rugged individualism or is something missing in the transitional process with either over recommendations to post-acute placement or recommendations to poorly rated post-acute placements leaving patients fearful to go and electing home instead.  

AMA discharges will always carry clinical, ethical, and operational complexity. However, with clear documentation processes, and patient-centered language, that supports coding visibility and subsequent use of Discharge Code 07, hospitals can reduce risk of erroneous readmissions as well as penalties from CMS and payers.  

This process will alleviate hospital risk if the patient requests to discharge to an ‘unsafe’ location or prior to care being complete.

Case Management Corner: How AI and Technology are Transforming Discharge Planning

By Kelly Bilodeau

In an era where case managers often need to do more with less, new technologies are providing a helping hand with discharge planning. Most EMR systems now have integrated artificial intelligence (AI) and machine learning that flag patients at high risk for complications, hospital readmissions, and extended lengths of stay. However, many case management programs are not fully integrating these tools into their daily practice.

“The technology gives us the ability to identify and manage the most complex patients but we have to utilize the tools and put standard processes in place to allow case managers to focus their time where it’s needed most,” said Marie Stinebuck, COO of Phoenix Medical Management.

While technology is a valuable assistant that can identify care gaps, recommend evidence-based interventions, and guide discharge planning, it is designed to augment, not replace, people. Patients still need case managers to apply judgment and critical thinking skills to guide their progression of care, Stinebuck said.

New tools save time

When applied correctly, AI and other digital tools can reduce the administrative burden for case managers. EMR-integrated risk stratification programs such as the LACE Index or Project BOOST use criteria such as polypharmacy, comorbidities, chronic diagnoses, or a recent readmission within 30 days of discharge to identify high-risk patients. These tools allow case managers to intervene earlier and potentially prevent avoidable readmissions. This is crucial because hospitals with high readmission rates among Medicare patients with certain conditions may face penalties under the Hospital Readmissions Reduction Program. Organizations should note that CMS recently expanded this program to include Medicare Advantage patients starting in 2026.

While automated systems are helpful, case managers shouldn’t rely exclusively on these tools. Medicare conditions of participation require a licensed professional, such as a nurse or social worker, to conduct the assessment and develop the patient’s care plan. This requires clinical reasoning and human insight that AI can’t replace. “Our role is as an advocate for our patients and to identify those patients with high-risk needs,” Stinebuck said.

AI working against case managers

Although AI tools can be helpful, they’re also adding new layers of complexity for hospitals and case managers. Payers have fully joined the tech revolution, leveraging advanced AI and machine learning algorithms to review patients in near real time. These algorithms scan thousands of clinical data points to predict level-of-care recommendations. This provides an efficient means to deny post-acute placements, creating multifaceted challenges. AI tools are not always able to capture nuanced patient needs, such as social determinants of health or a lack of caregiver capacity, factors that may affect their ability to recover safely at home without additional support.

Patients often have little choice but to challenge these determinations, triggering a series of appeals and denials that can lead to excess and avoidable days. Case managers need to spend time managing these appeals, as well as coordinating post-acute placement and repeatedly adjusting discharge plans. This represents a significant, often immeasurable loss in productivity.

Looking to the Future

Technology will likely continue to play a pivotal role in discharge planning in the coming years. However, as case managers gain access to new tools, the core skills they bring to the job are still vital. Technology can’t replace clinical expertise, empathy, or the ability to determine what’s best for each patient.

Case Management Corner is your go-to source for insightful discussions on relevant topics in case management. Through an engaging interview-style format, our team members share their expertise, experiences, and best practices to keep you informed and empowered. Whether you're looking for industry updates, practical strategies, or real-world perspectives, we bring you valuable conversations designed to enhance your knowledge and support your professional growth. Stay tuned for expert insights straight from the field! Kelly Bilodeau has been a longtime writer for HCPro’s Case Management Monthly. 

Updates to CMS CoP Interpretive Guidelines: Discharge Planning Evaluation & Choice Process

By Tiffany Ferguson, LMSW, CMAC, ACM

In a recent article, I focused on the screening and discharge planning policy requirements for §482.43 Discharge Planning found in the Centers for Medicare & Medicaid Services (CMS) Conditions of Participation (CoP) Interpretive Guidelines, The State Operations Manual (SOM), Appendix A. This article will cover the most important aspects of case management practice: the discharge planning evaluation (i.e. initial assessment) and the choice process.

The interpretive guidelines emphasize that hospitals must assess each patient’s likely need for healthcare, non-healthcare, and community-based services following discharge. This expectation applies to all patients who have been screened or consulted, regardless of whether their anticipated trajectory is straightforward or complex.

Healthcare services may include the following:

• Home health, personal attendant care, and/or other community-based services;

• Hospice or palliative care;

• Respiratory therapy;

• Rehab services (physical, occupational, speech) and/or post-acute placement;

• End-stage renal disease dialysis services;

• Pharmaceuticals and supplies;

• Substance use or behavioral health treatment;

• Nutritional consultation and supplemental supplies; and

• Durable medical equipment (DME).

At the same time, CMS has expanded the definition of essential post-discharge services to encompass non-traditional supports that directly affect the patient’s ability to remain in the community.

These may involve the following:

• Home modifications or safety improvements;

• Transportation assistance;

• Meal delivery or nutrition programs; (and)

• Household services such as shopping or housekeeping.

Once the needs are identified, hospitals are required to determine whether services are available and accessible in the patient’s community. This requires that case management programs maintain current knowledge of local providers, including not only skilled nursing facilities (SNFs) and home health agencies (HHAs) but also behavioral health providers, dialysis centers, equipment suppliers, and community-based organizations.

A key expectation in the guidelines is that hospitals cannot simply recommend services; they must ensure that those services are realistically obtainable by the patient. Accessibility includes consideration of insurance coverage, transportation to appointments, language or cultural barriers, and the patient’s ability to participate in care. If the patient or their informal caregivers cannot independently meet the required needs, the evaluation must determine whether community-based alternatives exist that allow the patient to remain at home, rather than defaulting to institutional placement.

Another critical component is coordination with insurers, including Medicare Advantage (MA) and Medicaid plans. Hospitals are required to verify that prescribed services are approved, covered, and available, to prevent scenarios in which patients are discharged with care plans that cannot be implemented. This payer coordination ensures not only compliance, but also practical feasibility of the discharge plan.

The ongoing documentation must demonstrate the arrangement of the discharge plan. This includes the following:

• Educating patients and caregivers on self-care responsibilities;

• Providing training to family or support people who will assist post-discharge;

• Coordinating transfers to post-acute/rehabilitation or long-term care facilities when needed;

• Making referrals to home health, hospice, behavioral health providers, etc.; and

• Facilitating access to medical equipment and community support.

The process must also ensure that patients are given clear instructions on how to handle issues after discharge, including whom to contact with concerns, when to follow up with providers, and what symptoms or circumstances should prompt urgent or emergency care.

CMS emphasizes that the process is collaborative and must include the patient, their representative, and/or other family or informal caregivers who will provide care at home. Patients and caregivers must be kept informed throughout plan development and be provided with education and training tailored to their roles. Evidence of this collaboration must be documented in the medical record.

The guidance cautions hospitals against directing patients toward specific providers, instead emphasizing the freedom of choice among Medicare-participating post-acute facilities or agencies. When patient preferences cannot be accommodated, such as when a preferred SNF has no available beds, hospitals must document the reason and communicate transparently with the patient or representative.

As seen by hospitals, the guidance was clear that referrals cannot be blanketed to post-acute facilities, without confirming with the patient that those specialized services are required and that the patient consents to those services first. Similar to other processes, CMS emphasizes patient autonomy, collaboration, and inclusion in the process.

The plan must reflect their actual needs.

Some of the questions included in the guidelines include, among others, the following:

• Does the evaluation identify both healthcare and community-based service needs?

• Does the hospital demonstrate knowledge of available providers and services in its service area?

• Is there evidence in the medical record of how the evaluation informed the discharge plan?

• Was the plan discussed with the patient and/or representative, with documentation of that discussion?

• Were patients provided with lists of Medicare-participating providers, when applicable, along with disclosure of any financial interests and inclusion of data on quality ratings?

The expanded requirements for discharge planning evaluations reflect the CMS recognition that safe transitions depend on comprehensive, realistic, and patient-centered planning. For hospitals, compliance will require interdisciplinary collaboration, robust knowledge of community resources, and an understanding of payer networks.

Prepare for Aetna to change inpatient payment policy in november

By Eileen Sullivan, MSN, CMAC, CCM, ACM-RN

Effective November 15, 2025, Aetna will implement a new Level of Severity Inpatient Payment Policy for Medicare Advantage (MA) and Medicare Special Needs Plan (SNP) members.

Key Points:

• Automatic Approval: Urgent and emergent inpatient admissions will be automatically approved for MA/SNP members.

• Payment Determination: Admissions that do not meet MCG inpatient criteria will still be approved as inpatient but reimbursed at a lower-severity inpatient rate, not outpatient or observation.

• Reimbursement: These cases will be paid as inpatient (IP) downgrades, similar in concept to DRG downgrades.

• No Denials: These are not considered medical necessity denials; therefore, no member or provider appeal rights are triggered under denial protocols.

• Provider Notification:

• Hospitals will receive concurrent notification of downgrades.

• A physician-to-physician “discussion” will be available during the concurrent review process (not labeled as peer-to-peer/denial-related).

• No Member Impact: MA members will not be notified of the downgrade, and their cost-sharing/copayment will not be affected.

• Observation Status: These cases are not reclassified as observation and will not be reimbursed at observation rates.

• CARC Code: A specific Claim Adjustment Reason Code (CARC) will identify these downgrades.

• Appeals: If the concurrent discussion does not resolve the issue, providers may submit a formal appeal, following a process similar to DRG downgrade disputes.

Aetna will issue detailed guidance on October 15, 2025, outlining:

• The review methodology (e.g., AI, nurse, or physician-driven)

• Readmission handling

• Specific reimbursement models/rates

Outstanding Questions & Clarification Needed:

1. Reapplication of MCG Criteria:

• Will Aetna reapply MCG criteria during the course of the stay (e.g., for extended lengths or complications), or is the initial level-of-severity determination final regardless of hospital course?

2. CMS Regulatory Compliance:

• According to 42 CFR § 422.566(d), CMS requires written notice of appeal rights to both beneficiaries and providers when services or payments are partially denied.

3. Definition of Medical Necessity:

• CMS guidance explicitly states that denial terminology includes "medical necessity" and any substantively equivalent term (e.g., severity). Can Aetna bypass peer review and appeal processes simply by avoiding the term “medical necessity”?

4. Policy vs. Compliance Conflict:

• In CMS Final Rule 4201-F, CMS clarified that payers may not avoid denial requirements by recasting medical necessity decisions as payment integrity issues. Does Aetna’s new policy conflict with this rule?

5. Contractual Reimbursement Terms:

• Can Aetna legally apply this payment downgrade policy without amending DRG-based reimbursement terms in existing provider contracts?

Aetna’s upcoming Level of Severity Inpatient Payment Policy represents a significant operational and regulatory shift in how inpatient services for Medicare Advantage and SNP members are classified and reimbursed. While the policy aims to streamline approvals and reduce outright denials, it raises substantial compliance questions under CMS regulations regarding medical necessity determinations, appeal rights, and contractual payment terms. Hospitals should prepare for potential impacts on reimbursement integrity, utilization review workflows, and payer relations by reviewing their contract language, monitoring Aetna’s forthcoming implementation guidance, and seeking clarification from regulatory or legal experts to ensure alignment with federal requirements and patient protection standards.

Updates to CMS CoP Interpretive Guidelines: Discharge Planning

By Tiffany Ferguson, LMSW, CMAC, ACM

As alluded to on Monitor Mondays, Dr. Ronald Hirsch and I have been enjoying our fall lattes while combing through the Centers for Medicare & Medicaid Services (CMS) Conditions of Participation (CoP) Interpretive Guidelines.

The State Operations Manual (SOM), Appendix A – has new updates for hospitals in their QSO-25-24 release, thank goodness (because the last one was 2019-2020). 

Although there are many updates in this version, I will be focusing on §482.43 Discharge Planning. I will preface this information with a healthcare reminder that “if you didn’t document it, you didn’t do it.” This will be important as I provide future updates, and as hospitals and healthcare system case management (CM) programs think about their processes.

One of the most notable changes is the strengthened emphasis on patient and caregiver participation in the discharge planning process. Hospitals must actively involve patients and their families in setting goals of care and treatment preferences. The discharge plan must not only reflect medical needs, but also incorporate patient values, cultural considerations, and post-discharge priorities. Surveyors will expect documentation that patients and caregivers were given meaningful opportunities to engage in decision-making and were informed of available post-acute options.

CMS reiterates that hospitals are responsible for early identification of patients who require discharge planning services. The updated guidelines clarify that the discharge planning process is expected to begin early in the hospitalization. Hospitals are directed to identify, upon admission, those patients who are likely to suffer adverse health consequences if discharged without adequate planning. This early screening allows sufficient time to complete evaluations and develop discharge plans that truly support patient needs, goals, and preferences.

The hospital’s policies and procedures must document the criteria and screening process used to identify patients who are likely to need discharge planning. These criteria should be evidence-based and clearly outline which staff are responsible for carrying out the evaluations. Importantly, CMS has clarified the survey standard: no noncompliance citations will be issued if identification is completed at least 48 hours in advance of discharge, provided there is no evidence that the delay resulted in harm.

The interpretive guidance also provides an important example. If a delay in screening results in discharging a patient to a nursing facility simply because such placements can be arranged quickly, when the patient preferred to go home and could have been safely supported with community services, this would represent a failure of timely identification. Even for hospital stays shorter than 48 hours, patients must still be screened promptly to ensure that discharge planning is completed before discharge, if needed.

This explanation reiterates CMS’s expectation that hospitals move away from last-minute discharge planning and instead adopt a proactive, patient-centered approach that maximizes safe and appropriate transitions of care. Additionally, the CM programs must have a mechanism for patients who were screened out initially as not having discharge planning needs, to be reassessed should the patient’s clinical condition change. It was also confirmed that should the physician request a discharge planning evaluation for their patient, one should be completed even if the patient did not meet the screening criteria.

The guidelines also specify that discharge planning evaluations must be conducted by, or under the supervision of, qualified personnel such as registered nurses, social workers, or other staff designated by hospital policy. This clarification ensures consistency and accountability in who performs and oversees these assessments. State law ultimately governs the qualifications necessary to practice as a registered nurse or social worker, but hospitals must further define in policy what constitutes “appropriately qualified” for other personnel engaged in discharge planning.

Importantly, the guidelines remind us that discharge planning is not a clerical or administrative task, but a specialized clinical function that requires both technical and interpersonal competence. CMS expects that all individuals conducting or supervising discharge planning, whether nurses or social workers, should demonstrate comprehensive knowledge across several domains, such as clinical considerations, social and behavioral factors, insurance coverage, and community resources.

Overall, now would be a good time to review your discharge planning policies and procedures to not only make sure they support the interpretive guideline updates, but also that there is a mechanism within your CM programs to ensure consistency across patients and staff.

When “Nowhere To Go” Becomes A Compliance Problem

By Tiffany Ferguson, LMSW, CMAC, ACM

It is a common scenario that hospitals are grappling with patients who are medically ready for discharge but have no safe place to transition to. With post-acute beds at capacity, family limitations, and gaps in social support, these patients often remain in the hospital for days or even weeks, creating both financial strain and compliance risk. Recently, a health information management (HIM) coding professional asked a critical question: When patients are “discharged” from inpatient status but physically remain in the hospital, how should that be documented and coded?

To understand inpatient admissions and appropriate conversions to outpatient or discharge regulations, the starting point is CMS. Once a patient is admitted as an inpatient, they must remain in that status until discharge. Under 42 CFR § 412.4, an inpatient stay ends only upon discharge to home, death, or transfer to another licensed facility (such as a skilled nursing facility or swing bed). An inpatient who never physically leaves the hospital cannot be “downgraded” to outpatient in a bed (OPIB). Attempting to do so is not just an accounting maneuver, it undermines patient appeal rights and disrupts the proper application of MS-DRG reimbursement for the inpatient stay.

If we look at adjacent guidelines for the inpatient discharge process, we can see that CMS has a notification process for patients that are converted from inpatient to outpatient through the Condition Code 44 (CC44) process, which is intended for patients erroneously placed in inpatient. Additionally, with the role out of the Medicare Change of Status Notice (MCSN) it is very clear that CMS would want patients, if medically appropriate, to retain their inpatient designation to obtain their SNF benefits. A prolonged inpatient hospitalization, with a conversion to Outpatient in a Bed (OPIB) would sidestep these notices but also raise further ethical questions and remove the patient of their benefits to retain their inpatient admission or appeal their discharge. This would also raise questions as to why the patient was not discharged to a post-acute facility and instead stayed in an acute care facility that is not licensed appropriately to provide prolonged rehabilitation or custodial care for these patients.

I have also received questions about if it is possible to discharge the patient and then create a new encounter for the patient in the OPIB classification if they are inpatient. The answer is no; this practice is particularly concerning. If a patient is reported to CMS as discharged home but is, in fact, still residing in the hospital which is not licensed as a long-term care or residential facility, the hospital risks a licensing violation. Beyond compliance, this exposes patients to inappropriate billing practices and undermines the integrity of the discharge process.

So how should hospitals manage this dilemma?

• Keep patients in inpatient status until true discharge: If they remain in the facility, they remain inpatient, even if their continued stay is no longer medically necessary.

• Document avoidable days: Use internal tracking to note when patients are awaiting placement due to social factors. This transparency supports case management performance reporting and helps quantify the cost of “social delays.”

• Engage leadership on capacity solutions: The root issue, lack of safe post-acute options, requires systemic solutions, not just coding workarounds.

As discharge delays and struggles continue with social and custodial issues, hospitals must strike a balance between patient care, regulatory compliance, and financial stewardship. Treating “nowhere to go” patients as outpatient boarders or prematurely coding them as discharged is not the answer. Instead, adherence to CMS rules, coupled with clear documentation of avoidable days, ensures compliance while spotlighting the urgent need for expanded post-acute resources. Ultimately, while social admissions may feel like a local operational problem, they are a national signal of system strain.

CMS FY26 IPPS Final Rule: Readmissions Expands To MA

By Tiffany Ferguson, LMSW, CMAC, ACM

The CMS FY 2026 Inpatient Prospective Payment System (IPPS) Final Rule is here, and case management leaders, as well as quality teams, should take note. The rule brings both confirmation of significant policy shifts and signals of what is coming in likely future rulemaking.

CMS confirmed that beginning in FY 2027, the Hospital Readmissions Reduction Program (HRRP) will expand to include Medicare Advantage (MA) patients, not just traditional Medicare (FFS) beneficiaries. This means the baseline data collection period will be from July 2023 to July 2025. The finalized updates include:

• Refinement of all six readmission measures to incorporate MA patient cohort data.

• Reduction of the applicable period from three years to two.

• Codification of the Extraordinary Circumstances Exception (ECE) policy, giving CMS discretion to grant modifications.

• Removal of the COVID-19 exclusion from all six readmission measures.

Notably, CMS decided not to finalize the inclusion of MA payment data in aggregate readmission penalty calculations, at least for now. The comments related to the inclusion of MA plans significantly expressed provider opinions and tone related to MA plans lack of payment for readmissions as well as their narrow networks which impact beneficiary access to care. Although CMS recognized this in their replies, they are focused on quality outcomes and the reality is that half of Medicare beneficiaries are in an MA plan and thus the data should include all Medicare beneficiaries.

An interesting mention in the readmission discussion and section was the use of “leave of absence” billing practices (Medicare Claims Processing Manual, Chapter 3, Section 40.2.5). Hospitals may place a patient on leave of absence when a readmission is expected but the patient does not require inpatient-level care during the interim. Importantly, this generates only one bill and one DRG payment, not two separate admissions.

As CMS evaluates readmission differences between FFS and MA populations, expect further attention around this practice, particularly as MA data become integrated into HRRP. It was unclear in the review exactly the significance of why this guideline was raised in the readmission option, but important to note.

CMS is also exploring refinements to readmission measurements, including:

• Breaking down readmissions into 7-day and 14-day cohorts (not just 30-day).

• Analyzing ambulatory care utilization and its relationship to readmission risk.

• Separating readmission patterns across MA and FFS populations.

The FY 2026 IPPS ruling demonstrates CMS’s widening focus on readmissions, with Medicare Advantage now confirmed as ‘in scope’. For case management and quality leaders, the charge is twofold: Operationally, prepare for MA populations to be included in HRRP penalties, and strategically reexamine how data, discharge planning, and post-acute coordination will be managed under a shortened two-year reporting cycle.

Philosophical Changes from SDoH to Well-Being Measures

By Tiffany Ferguson, LMSW, CMAC, ACM

For this fall fashion season, the social determinants of health (SDoH) are out, and nutrition and well-being are in! Yet the parameters are not yet defined.

Arguably the most notable change in the Inpatient Prospective Payment System (IPPS) Final Rule for the 2026 fiscal year (FY) was the Centers for Medicare & Medicaid Services’ (CMS’s) decision to remove health equity as a pay-for-performance domain. This means that beginning at the end of this year, hospitals will no longer be required to conduct or submit data from the standardized five SDoH screening questions covering housing stability, utilities, personal safety, transportation, and food insecurity.

While the removal of federal reporting requirements reduces administrative burden, it simultaneously creates a new ethical dilemma for case management. The data captured through social risk screenings is not simply a regulatory checkbox; it remains essential for ensuring safe and effective care transitions.

For example, identifying unsafe living conditions is not optional; it directly ties to mandated reporting obligations that protect patient safety. Likewise, awareness of barriers such as food insecurity, utility shutoffs, or lack of transportation directly influences discharge planning and elevates the risk of readmission when left unaddressed. Housing instability has been shown to correlate strongly with inappropriate hospitalizations and extended lengths of stay, often driving costs higher while compromising patient outcomes.

In this way, the absence of a federal reporting mandate does not lessen the clinical and ethical responsibility of case managers. Instead, it challenges organizations to determine how they will continue capturing, documenting, and acting on these risk factors. Based on CMS’s responses to public comments, the agency has clarified that hospitals may voluntarily retain these screenings, even though they are no longer tied to federal reporting requirements. Thus, hospitals can choose to reframe these questions and data as internal quality metrics.

By repositioning these screenings as tools to inform care coordination, discharge planning, and readmission prevention, hospitals can continue to capture critical data that directly impacts patient outcomes. Ultimately, this approach could position case management and quality leaders to leverage the screenings for what they were always intended to do: illuminate barriers to safe transitions of care and reduce avoidable hospital utilization.

The Final Rule also included extensive commentary on potential well-being and nutrition measures for hospital reporting. While CMS did not adopt new requirements, they solicited and summarized significant stakeholder feedback.

Many commenters argued that well-being and nutrition measures are better suited for primary care or outpatient settings, not acute inpatient care. There were comments related to concerns from rural and resource-limited hospital leaders worried that such measures would be impractical and hold hospitals accountable for factors outside their control.

Regarding nutrition, many supported wider adoption of the Malnutrition Care Score (MCS) eCQM, with some recommending it be made mandatory. Commenters also highlighted food insecurity, diet quality, and hospital-community partnerships (e.g., medically tailored meals, food pharmacies) as vital to discharge planning and long-term health. Suggestions also pushed for a rephrasing of the conversation to outcome-based measures reflecting improvements in health and quality of life, similar to an alignment with SDoH screening. It’s kind of like a rebrand of SDoH as well-being!

CMS did not issue new mandates in FY 2026, but noted that this feedback will inform future measure development for the Hospital Inpatient Quality Reporting (IQR) Program.

CMS Releases 2025 Fast Facts On Hospice Program Integrity

By Tiffany Ferguson, LMSW, CMAC, ACM

The Centers for Medicare & Medicaid Services (CMS) recently published a concise “Hospice Fast Facts,” which provides key insights into hospice utilization in the 2024 fiscal year (FY), Medicare payment volumes, and program integrity initiatives.

In the one-sheet paper, we see that Medicare hospice spending exceeded $27 billion in FY 2024, and that roughly 1.8 million Medicare beneficiaries received hospice care during that period. Although the document emphasized that hospice is an essential benefit within the Medicare program, many of the bullet items discussed the concern regarding potential overutilization of hospice services.

For reference, hospice providers are reimbursed on a per‑diem basis, with rates varying according to the type of care delivered, ranging from routine home care to continuous home care, general inpatient care, or inpatient respite care.

The document appears to align with CMS’s expanding program integrity efforts to curb fraud, waste, and abuse among Medicare‑enrolled providers – and in this case, hospice providers. The Center for Program Integrity (CPI) is leading these initiatives, utilizing enforcement actions, provider education, and targeted audits to ensure that program funds are used appropriately.

In the review for FY 2024, CMS identified concerning trends, including improper billing and hospices not being fully operational at their registered addresses. In response to this, they have initiated site visits, claim reviews, and administrative actions for identified hospice agencies that are being flagged with potential concerns for program integrity.

CMS notes that hospice utilization and expenditures have steadily increased in recent years. This growing financial footprint invites heightened oversight, especially as CMS balances access to end‑of‑life care with safeguarding taxpayer dollars. For hospice administrators, clinicians, and compliance officers, the fact sheet serves as a critical reminder of the importance of operational transparency, accurate provider enrollment, and address validation.

It is also important to see how there will likely be ongoing scrutiny of hospice agencies from CPI via audits, reviews, and potential enforcement.

Now would be an important time to proactively review the patient referral and acceptance process, documentation, and billing standards.

While the fact sheet does not delve into future payment update proposals, it complements broader CMS policy initiatives such as upcoming proposed rules for the FY 2026 hospice wage index, payment update percentages, and quality reporting requirements. These forthcoming rules will determine next year’s payment rates, hospice cap limits, and revisions to regulations around physician certification and quality reporting requirements.

Case Management Corner: A Nurse Case Manager or a Social Work Case Manager?

By Kelly Bilodeau

Nurse case managers and social workers were once a natural pairing, working in tandem to support the patient.

“The idea was that nurses would handle medically complex issues while social workers would focus on social needs,” said Tiffany Ferguson, LMSW, CMAC, ACM, CEO of Phoenix Medical Management Inc.

However, due to changing paradigms and a more challenging patient population, case managers and social workers today often find themselves stepping on each other’s toes, and it’s becoming increasingly clear that it’s time to rethink traditional roles, she said.

A Changing Role

Case management is undergoing a transformation, thanks to patient and care-related changes. “Length of stay is shorter. We’re more efficient,” Ferguson said. “Patients are simultaneously medically and socially complex.” A case manager needs to be able to handle both aspects.

While case management was once primarily the domain of nurses, who perceived the job as a step up from the bedside, that changed during the COVID-19 pandemic. Hospitals were forced to make nursing jobs more appealing to retain and attract staff members during the crisis.

“Now the incentives for a floor nurse are way better than they are for a nurse case manager,” says Ferguson. Not surprisingly, fewer nurses are making the shift. Instead, when many floor nurses decide to leave the bedside they are selecting remote positions or to pursue advanced training to become nurse practitioners, she said.

At the same time, case management has become increasingly appealing to social workers. “There’s an ample pool of social workers who are coming into the marketplace and want to work in healthcare,” Ferguson said. They’re stepping into roles at hospitals that are either a split nurse/social worker model. “Or they could be doing the same exact job as a nurse case manager,” Ferguson said.

Rethinking Hiring

To solve these issues, directors need to stop thinking about whether it’s best to hire a nurse or a social worker and instead start hiring the individual with the most potential as a case manager. This is someone with solid social skills who works well at the patient’s bedside and can communicate effectively with floor nurses, physical therapy staff, and physicians. “They have to be a go-getter, really autonomous at filling their day and getting everything accomplished with patients. They have to have good boundaries, and be skilled with technology,” Ferguson said.

From there, training can fill the gaps.

For a social worker, an onboarding program might focus on how to handle the medical complexities of the role, anticipating care pathways, medication protocols, and navigating prior authorization requirements.

Conversely, a nurse may need more education on social factors. However, as nursing becomes increasingly specialized, these candidates may perform some, but not all, aspects of care. They may also need additional training on how medical conditions and care plans translate to proactive transitional needs for the patient. For example, at many facilities, discharge and admission are handled by separate team members, so a bedside nurse may no longer be as adept at performing a history and physical or in anticipating the patient’s post-acute needs.

“It's not like it used to be where one nurse did all of it,” Ferguson said.

Onboarding and orientation should be tailored to the individual. “You can't assume based on the person's professional license that they're going to come in skilled enough and know how to do the job,” Ferguson said. The job has grown so challenging that even an adept case manager requires continual ongoing training to stay up to date, she said.

Overall, hiring decisions should no longer be about choosing between a nurse and a social worker. It’s about identifying adaptable, skilled professionals and giving them the tools they need to succeed, Ferguson said.

Case Management Corner is your go-to source for insightful discussions on relevant topics in case management. Through an engaging interview-style format, our team members share their expertise, experiences, and best practices to keep you informed and empowered. Whether you're looking for industry updates, practical strategies, or real-world perspectives, we bring you valuable conversations designed to enhance your knowledge and support your professional growth. Stay tuned for expert insights straight from the field! Kelly Bilodeau has been a longtime writer for HCPro’s Case Management Monthly. 

Ensuring Compliance with Condition Code W2 and 44 Processes

By Juliet Ugarte Hopkins, MD, ACPA-C

Condition Code W2 (CCW2), referred to by some as a “Medicare self-denial” or “Medicare Part B rebilling,” has been around for over a decade, since it was initially referred to in Chapter 6 of the Medicare Benefit Policy Manual. Dr. Alvin Gore, member of the Emeritus Board of the American College of Physician Advisors, wrote for RACmonitor.com back in May 2019, comparing CCW2 to Condition Code 44 (CC44). He recommended hospitals attempt to utilize the latter process over the former, opining that the CC44 process was more efficient, from a billing and reimbursement standpoint, and more transparent, from a patient status standpoint. 

I agree with Dr. Gore, and also refer to the Centers for Medicare & Medicaid Services (CMS) direction in the Federal Register from August 2013, which includes the following:

“Use of Condition Code 44 or Part B inpatient billing pursuant to hospital self-audit is not intended to serve as a substitute for adequate staffing of utilization management personnel or for continued education of physicians and hospital staff about each hospital’s existing policies and admission protocols. As education and staffing efforts continue to progress, inappropriate admission decisions, and the need for hospitals to correct inappropriate admissions or report Condition Code 44, should become increasingly rare.” 

This clearly states that hospitals may not default to CC44 or CCW2 to address lack of utilization review (UR) coverage, physician advisor coverage, or medical staff education about patient status assignment. Unfortunately, this continues to be a strategy for many hospitals challenged with staffing limitations.

Similarly, hospitals must ensure that they are compliantly following all of the steps in the CC44 and W2 processes. In 2021, I wrote in-depth about CC44, deconstructing the concepts between the code itself and the mandated Medicare process. While the CCW2 process applies to Medicare cases only, it’s imperative to understand that the details must be followed, no matter how complex and daunting they feel to carry out. Indeed, as Dr. Gore illustrated in 2019, the CCW2 process is complicated and time-intensive. However, it’s also mandated by CMS – and is not optional.

A common practice for retrospective “Medicare short stay” reviews involves Medicare patients discharged from the hospital in inpatient status following a hospitalization lasting fewer than two midnights. I believe that best practice extends this sampling to patients hospitalized for fewer than three midnights, capturing potential cases wherein an overzealous clinician or utilization manager changed the patient’s status to Inpatient solely based on the passage of a second midnight, without considering the medical necessity. 

CMS notes that there are specific caveats to the Two-Midnight Rule, including death, transfer to a higher level of care, and others, wherein inpatient billing is still appropriate, even if the hospitalization did not involve at least two midnights. Following review by an experienced utilization nurse, these cases should pass along to billing for completion as-is. Tricky cases, where it’s not clear if the patient who left against medical advice (AMA) early in the morning on hospital day two actually had a condition supporting a two-midnight anticipation on hospital day one, or all of the cases for which the “patient improved more quickly than anticipated” is referenced in the documentation, should be referred to a physician advisor for additional review.

If the physician advisor does not feel that the documentation supports a two-midnight anticipation, which would support Medicare re-billing under Part B, they must reach out to the physician who entered the inpatient order. Notification need not be lengthy, but should include the following points:

1. Retrospective review of the case does not find a two-midnight anticipation was warranted and (briefly) why;

2. The hospital plans on billing the case as outpatient to Medicare Part B instead of inpatient to Medicare Part A, but this does not affect or apply to provider billing;

3. The physician has an opportunity to disagree with the decision and must respond to request further discussion with the physician advisor by a specific deadline; and 

4. If the deadline passes and there is no response from the physician, Part B re-billing will proceed.

In the event the physician disagrees, there must be a discussion between her/him and the physician advisor. If the physician provides additional information that persuades the physician advisor that inpatient billing criteria was met, the physician advisor should pass the case along for Medicare Part A billing and advise the physician to include the missing clinical information in their H&P, progress note, or discharge summary, as appropriate. If the physician and physician advisor continue to disagree, a second physician on the hospital’s utilization management committee (UMC) should be required to review the case and weigh in. If this second UR physician agrees with the clinician that inpatient status was supported, the claim goes forward with Medicare Part A billing. If the second UR physician agrees with the physician advisor, the claim is re-billed to Medicare Part B.

Finally, patients associated with claims re-billed to Medicare Part B must be notified by the hospital. This can be automated within the electronic health record, utilizing a templated letter format, but should include information about where and how the patient can contact the hospital to discuss the situation, if they wish. 

How is your hospital reviewing and managing CCW2s? Is your physician advisor or other physician member of the UMC involved? Are attending physicians receiving notification and allowed a chance to respond? Are patients notified of the change in their claim? If you’re not sure, I encourage you to investigate and confirm that the process is being followed compliantly.

The CMS WISeR Model: A Targeted Approach To Expand Prior Auths

By Tiffany Ferguson, LMSW, CMAC, ACM

The Centers for Medicare & Medicaid Services (CMS) has announced the establishment of the Wasteful and Inappropriate Services Elimination and Reduction (WISeR) Model, a six-year initiative launching Jan. 1, 2026.

This so-described voluntary model (although in reading the guidelines, it becomes clear it is very much mandated for the six states) introduces a structured, technology-enabled approach to prior authorization and pre-payment review for selected Medicare Part B services deemed to be of low clinical value, overused, or associated with fraud, waste, and abuse.

The WISeR Model represents a significant evolution in the CMS oversight strategy. Historically, the use of prior authorization by Medicare has been limited to targeted service categories such as durable medical equipment (DME), non-emergency transportation, or certain outpatient procedures. WISeR is the first push to pair broad-scale, claims-based utilization analytics with Medicare Administrative Contractor (MAC)-directed pre-payment medical necessity review for professional and outpatient services.

As noted, WISeR will be implemented across six states: New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington. These states were selected based on Medicare volume, geographic diversity, and alignment within four existing MAC jurisdictions:

• JL (New Jersey);

• J15 (Ohio);

• JH (Oklahoma, Texas); and

• JF (Arizona, Washington).

Each participating state will serve as a testing ground for evaluating changes in service utilization, program integrity, and cost savings.

Providers in the six participating states will be required to either submit prior authorization requests for these services or accept a pre-payment review upon claim submission. Instead of the MACs, from the ruling, CMS will be using designated contractors, under MAC oversight, that will determine whether claims meet established medical necessity criteria. The ruling also mentioned the provision of this group to utilize artificial intelligence (AI)-enabled tools.

The specific procedures and devices that CMS has identified include the following:

• Electrical Nerve Stimulators (NCD 160.7);

• Sacral Nerve Stimulation for Urinary Incontinence (NCD 230.18);

• Phrenic Nerve Stimulator (NCD 160.19);

• Deep Brain Stimulation for Essential Tremor and Parkinson’s Disease (NCD 160.24);

• Vagus Nerve Stimulation (NCD 160.18);

• Induced Lesions of Nerve Tracts (NCD 160.1);

• Epidural Steroid Injections for Pain Management excluding facet joint injections (L39015, L33906, L39036, L39240, L39242, L36920, L38994, L39054);

• Percutaneous Vertebral Augmentation (PVA) for Vertebral Compression Fracture (VCF) (L33569, L34106, L34228, L38201, L34976, L35130, L38737, L38213);

• Cervical Fusion (L39741, L39799, L39770, L39758, L39762, L39793, L39773, L39788);

• Arthroscopic Lavage and Arthroscopic Debridement for the Osteoarthritic Knee (NCD 150.9);

• Hypoglossal Nerve Stimulation for Obstructive Sleep Apnea (L38276, L38307, L38398, L38387, L38310, L38312, L38385, L38528);

• Incontinence Control Devices (NCD 230.10);

• Diagnosis and Treatment of Impotence (NCD 230.4);

• Percutaneous Image-Guided Lumbar Decompression for Spinal Stenosis (NCD 150.13);

• Skin and Tissue Substitutes (LCDs below) – only applicable to MAC jurisdictions and states that have an active LCD in place;

• Application of Bioengineered Skin Substitutes to Lower Extremity Chronic Non-Healing Wounds (L35041); and

• Wound Application of Cellular and/or Tissue Based Products (CTPs), Lower Extremities (L36690).

An interesting consideration in the ruling, mentioned as an exploration, is the CMS provider safeguard known as “provisional affirmation.” If a claim is not affirmed, providers would receive a detailed rationale and may resubmit or appeal the determination.

Additionally, organizations demonstrating an affirmation rate of more than 90 percent over time may qualify for a gold-carding exemption, temporarily removing them from the prior authorization requirement, similar to commercial plans.

Financially, CMS will compensate the third-party reviewers not on volume, but based on a share of the Medicare expenditures they help avert, ensuring alignment with the CMS goals of reducing low-value care and reducing waste.

While inpatient services are not directly subject to the model, the ripple effects on outpatient surgery, interventional procedures, and medical device utilization will require cross-functional coordination. Surgical locations will want to have a clear understanding of the required medical guidelines for procedural authorization and approval. Clear, evidence-based documentation will be critical for both prior authorization requests and appeals.

WISeR reflects the CMS continued movement toward proactive utilization management, with an invested approach toward leveraging technology and a commercial payer approach. While the model is currently limited to six states and select services, its structure suggests a potential framework for broader application.

CMS Transitions Inpatient Hospital Short-Stay Reviews to the MACs

By Tiffany Ferguson, LMSW, CMAC, ACM

I’d like to begin with a thank-you to Dr. Stephanie Van Zandt, Medical Director of Physician Advisor Services at BayCare, for sharing this news.

The Centers for Medicare & Medicaid Services (CMS) is shifting the responsibility for inpatient hospital short-stay reviews from the Beneficiary and Family Centered Care Quality Improvement Organizations (BFCC-QIOs) to the Medicare Administrative Contractors (MACs), effective Sept. 1. According to the Inpatient Hospital Reviews FAQs | CMS, the justification for this change is to allow the BFCC-QIOs (Acentra Health and Livanta) to focus their efforts on quality improvement and expedited appeals. 

With the additional time afforded to the BFCC-QIOs, they will be shifting their focus to other quality-related functions, such as higher-weighted DRG reviews, hospital discharge appeals, and quality-of-care concerns. This realignment allows QIOs to focus on broader quality improvement initiatives, while MACs, already responsible for various audit and compliance efforts through the existing Targeted Probe-and-Educate (TPE) program, will bring greater oversight to short-stay reviews.

The inclusion for prepayment reviews on hospital short stays will now be prioritized for review under the MAC-led Targeted Probe and Educate (TPE) program. According to the FAQs from CMS, a hospital short stay is defined as a length of stay that is fewer than two midnights after inpatient admission. While such admissions may be clinically appropriate, CMS has identified them as having a higher risk category for improper payments. These reviews will be performed by registered nurses (RNs) with available access to the MAC’s medical director(s).

These reviews will evaluate patient status documentation to ensure that each patient’s condition supports the need for inpatient hospital services, in accordance with 42 C.F.R. § 412.3(d) and not proprietary commercial screening tools like InterQual or MCG.   

MACs will apply the existing TPE program, which uses data analytics to identify providers with outlier billing patterns. MACs will conduct these reviews on a prepayment basis, giving providers the ability to rebill Part B when Part A payment is denied, or pursue the further appeals should the provider disagree, in accordance with the Medicare appeals process. According to the details, this prepayment review will be completed with a sample of 20-40 claims per provider, as a round of review. Providers may have a total of up to three rounds before they are referred to CMS for additional administrative action.

CMS and the MACs have outlined an implementation plan that includes educational outreach, updated guidance in the Program Integrity Manual, and MLN communications. This transition will not change CMS’s patient status policies, nor diminish the importance of a physician’s clinical judgment. However, hospitals must now ensure that documentation clearly supports the need for inpatient care under the two-midnight rule. With MACs leading these reviews, providers can expect more targeted oversight, demonstrating CMS’s commitment to reduce waste and abuse.

New Requirements in CMS’ Conditions of Participation Regulations

By Tiffany Ferguson, LMSW, CMAC, ACM

Effective July 1, a subtle but significant expansion for the Centers for Medicare & Medicaid Services (CMS) added new requirements to 42 CFR § 482.43 regarding transfer protocols. Originally mentioned back in November 2024 as part of the CY 2025 Outpatient Prospective Payment System (OPPS) Final Rule, CMS announced the finalization of new requirements in conjunction with the maternal healthcare news briefs.

However, likely during the political change of offices, an interesting proactive statement was added to the Conditions of Participation (CoP) regulations that require acute-care hospitals to develop and implement written transfer protocols.

The finalized regulation, outlined in § 482.43(c), mandates that all acute-care hospitals have written policies and procedures governing intra-hospital and inter-hospital transfers. These include the following:

• Transfers from the emergency department to inpatient admission;

• Transfers between units within the same hospital; and

• Transfers between different hospitals for higher levels of care or specialized services.

While the transfer of patients between hospital units or facilities has long been a routine operational function, CMS is now moving to standardize and elevate the practice as a core compliance obligation, focused on improving patient safety, care transitions, and timely access to appropriate levels of care. This rule codifies what many hospitals already do, transferring patients from the ED to hospitalized patient units, between units, and to other facilities. But now, these processes must be formally documented in written policy, implemented organization-wide, and supported with annual training for designated staff.

Hospitals are also required to conduct annual training for relevant staff on these transfer protocols. Notably, CMS leaves flexibility for hospitals to determine which staff are included, allowing adaptation based on organizational structure and resources.

However, given the unique ties of this additional standard with obstetrics, consideration should be given to hospital admissions and transfers in and out of the mother-baby unit. For hospitals to ensure appropriate compliance, it makes sense to audit and formalize existing transfer policies.

Consider review of the existing annual training provided to applicable clinical staff to meet the requirements for providing information regarding transfer protocols.

In reviewing the original guidance and comments in the CY 2025 OPPS ruling as to what led to this change, CMS cited the need to reduce delays, ensure continuity, and protect patients in particularly vulnerable populations, such as pregnant and postpartum individuals. Federal Register :: Medicare and Medicaid Programs: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems; Quality Reporting Programs, Including the Hospital Inpatient Quality Reporting Program; Health and Safety Standards for Obstetrical Services in Hospitals and Critical Access Hospitals; Prior Authorization; Requests for Information; Medicaid and CHIP Continuous Eligibility; Medicaid Clinic Services Four Walls Exceptions; Individuals Currently or Formerly in Custody of Penal Authorities; Revision to Medicare Special Enrollment Period for Formerly Incarcerated Individuals; and All-Inclusive Rate Add-On Payment for High-Cost Drugs Provided by Indian Health Service and Tribal Facilities

Case Management Corner: Why Are Case Managers Using The Same, Tired Framework?

By Kelly Bilodeau

Today’s case managers have digital tools, value-based goals, and post-pandemic challenges. So why are they still relying on a 1990s playbook?

For decades, hospitals have used the Triad Model: a case manager, social worker, and utilization review specialist committed to getting the patient out of the hospital as quickly and efficiently as possible, according to Marie Stinebuck, MBA, MSN, ACM, COO at Phoenix Medical Management Inc. However, as patient complexity rises, staff numbers shrink, and goalposts shift, this three-legged structure is buckling under modern demands, said Tiffany Ferguson, LMSW, CMAC, ACM, CEO of Phoenix Medical Management.

 It’s time for a new framework—the Adaptive Model, which Ferguson recently outlined in an article for CMSA Today.

Navigating post-COVID challenges

Many hospital officials recognize that the Triad Model is a problem, Ferguson said in a recent Finally Friday webinar.

“People are coming to us saying, ‘We need to look at this model. I don't think we have the right staffing mix,’” she said.

Job responsibilities feel muddled. Case managers and social workers often have overlapping responsibilities, which creates redundancies and confusion for patients. The Utilization Review (UR) role evolved significantly during COVID, as many positions transitioned to remote work. This shift altered the dynamics and collaboration within the inpatient care team. These factors put a drag on efficiency in a department that is already often understaffed and overburdened following a surge in pandemic-driven retirements.

At the core of these issues is an outdated system, way overdue for an update.

“Until readmissions became a key focus around 2012, case management remained primarily centered on discharge planning," Stinebuck said.

Since that time, hospitals have adopted integrated technology, including automated workflows and AI-driven case management software, and added post-acute partners. However, the foundational model hasn’t caught up.

Moving to a new approach

Where the Triad Model falls short in promoting proactive pre-hospitalization planning or addressing the social needs of patients, the Adaptive Model excels. It helps to eliminate redundancies between case management and social work.

“This new Adaptive Model looks at those roles. How do we complement each other without overlapping and work in the best interest of that patient?” Stinebuck said.

It also expands the tent, incorporating new team members, such as the physician advisor, a position formalized after the Triad Model’s inception, and non-licensed professionals. These non-licensed staff members reduce the burden on case managers by handling routine administrative tasks like scheduling outpatient appointments, arranging transportation, and delivering regulatory notices. This frees case managers to focus on more critical aspects of patient care and new goals, such as readmission prevention, addressing social determinants of health, and meeting value-based care targets.

The Adaptive Model also recognizes the time-saving value of integrated technology and expands interventions beyond inpatient units. Care has changed. The Adaptive Model follows patients into the emergency department, pre-surgical and hospitalized outpatient units, and even into their homes using telehealth.

Making the shift

Now, the goal should be to make changes that help case management meet patient needs in a world where efficiency is more crucial than ever. Case management no longer starts and ends in the hospital. Planning begins before admission, extends after discharge, and goes beyond simply pushing people through the system. The Adaptive Model is patient-centered and offers case managers the tools and the bandwidth to meet their needs at a time when demands often outstrip resources.

The old model is costing hospitals “time, money, and sanity,” said Ernie de los Santos, host of the Finally Friday webinar. It’s time to transition. The shift to the Adaptive Model isn’t just an evolution, “it’s a survival strategy,” he said.

Case Management Corner is your go-to source for insightful discussions on relevant topics in case management. Through an engaging interview-style format, our team members share their expertise, experiences, and best practices to keep you informed and empowered. Whether you're looking for industry updates, practical strategies, or real-world perspectives, we bring you valuable conversations designed to enhance your knowledge and support your professional growth. Stay tuned for expert insights straight from the field! Kelly Bilodeau has been a longtime writer for HCPro’s Case Management Monthly.