Inpatient HINNs: Protecting the hospital’s right to recover payment for non-covered services

Last week, I participated in an HCPro audioconference on HINNs. “HINN” stands for hospital-issued notice of non-coverage. It’s the inpatient equivalent of an advanced beneficiary notice (ABN). Under Medicare’s limitation on liability (LOL) provisions, hospitals are required to provide prior notice, in a prescribed form, when certain outpatient or inpatient services ordered by a physician do not meet Medicare’s medical necessity guidelines for the patient’s condition.

In such cases, the ABN is the prescribed form of prior notice for outpatient services, while the HINN is the prescribed from of prior notice for inpatient services. Although the prior notice requirements for LOL have been in place for a number of years, hospitals continue to struggle to provide timely, appropriate notification, particularly in the inpatient setting.

In the inpatient setting, LOL applies to the following:

• Inpatient services (in whole [entire stay] or in part) that
  • Are not considered reasonable and necessary;
  • May be safely provided in another lower acuity setting; or
  • Are custodial in nature; or
• Severable inpatient services ordered during an otherwise covered inpatient stay that are not considered reasonable and necessary under a written Medicare policy and are not tied to the reasons justifying that inpatient stay

When any of these inpatient situations arise, hospitals must provide the appropriate HINN notice prior to the performance of the services in order to reserve the right to bill the beneficiary for these services if Medicare agrees that they are non-covered. Currently, there are three different HINN forms in effect. They are all designed to notify the beneficiary of potential liability for non-covered inpatient services in the circumstances identified above. The current HINNs include the following:

• Preadmission/Admission HINN
• HINN 12
• HINN 11

The Preadmission/Admission HINN is used when the hospital believes that the entire stay fails to meet Medicare’s inpatient medical necessity guidelines. It doesn’t require the physician’s agreement, but must be provided no later than the day of admission. Notice should be provided as soon as possible to minimize the hospital’s liability for services provided during that stay.

HINN 12 is provided during a continuing stay which initially meets inpatient guidelines. At some point, however, the hospital decides that it is no longer medically necessary for the patient to remain, and proposes, with the agreement of the patient’s physician, to discharge the patient. The patient disagrees with the hospital’s discharge decision and remains in the hospital past midnight of the day of the proposed discharge without seeking timely review of the hospital’s discharge decision by the QIO (quality improvement organization). (Timely review requires a request for review prior to midnight of the day of the proposed discharge.) HINN 12 notifies the patient that he or she will be liable for all services provided after midnight, unless the QIO (if review is requested) disagrees with the hospital’s discharge decision.

HINN 11 is distinguishable from the other two HINNs in that it only applies to discrete, severable services ordered during an otherwise covered inpatient stay. Those discrete, severable services must be excluded from coverage as medically unnecessary under a written Medicare policy. In addition, those services cannot be bundled into or integral to payment or treatment for the diagnoses or reasons justifying that inpatient stay. Prior notice must be provided to both the patient and to the ordering physician and becomes effective immediately upon delivery. Although the Preadmission/Admission HINN is relatively easy to deliver as part of the registration process, timely delivery of the HINN 12 and HINN 11 are more problematic. With all three HINNs, it’s essential to have an effective case management/utilization review (CM/UR) function to identify situations requiring the respective HINNs, as well as to assure timely delivery of the appropriate form.

Once delivered, the hospital must be sure to document delivery and communicate relevant information to other departments with related functions (e.g., coding, billing, finance, etc.). Hospitals are encouraged to review their existing processes to determine whether improvements are needed to protect their right to recover from beneficiaries when LOL applies in the inpatient setting.