The error rate under the two-midnight rule was 14%, according to the first year of hospital reviews by Livanta—the Beneficiary and Family Centered Care-Quality Improvement Organization (BFCC-QIO)—since they resumed in October 2021. Livanta conducts short-stay hospital audits for CMS and the findings were reported in its March 2023 newsletter.^[1]

“After review, 86 percent of SSR [short-stay review] claims were approved for appropriate Part A reimbursement,” Livanta said. Claims with a zero-day length of stay had an 18% denial rate. The findings were based on Livanta’s review of 18,672 claims. The highest error rate (21%) was in region two, which includes New York, New Jersey, Puerto Rico and the Virgin Islands. The lowest (9%) was in region 10, which includes Alaska, Idaho, Oregon and Washington.