Medicare Part A provides, among other things, inpatient hospital insurance benefits and coverage of extended care services for beneficiaries after they are discharged from hospitals. In calendar years (CYs) 2009 and 2010, Medicare made Part A prospective payments to hospitals of $597 million for inpatient claims that involved a canceled elective surgery. Almost $55 million involved short-stay (2 days or fewer) claims. When an inpatient hospital admission is based on the expectation that a patient will have elective surgery but that surgery does not occur, that cancellation would generally make the admission not reasonable and necessary. Our reviews at several hospitals indicated that short-stay inpatient claims involving canceled elective surgeries often did not meet Medicare requirements for Part A prospective payments because the admissions were not reasonable and necessary. We, therefore, extended our review of Medicare payments for inpatient short-stay claims involving canceled elective surgeries to hospitals nationwide.
Our objective was to determine whether inpatient admissions related to short-stay hospital claims involving canceled elective surgeries were reasonable and necessary.
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