AHA urges Aetna to rescind ‘level of severity inpatient payment’ policy

The AHA Sept. 15 urged Aetna to rescind its recently announced “level of severity inpatient payment” policy, saying that it “could erode the transparency consumers rely on to make informed decisions about their care, undermine important regulatory protections that safeguard patients’ coverage, and jeopardize the ability of hospitals to provide high-quality, accessible care to all who need it.” 

Effective Nov. 15, Aetna will create a new type of inpatient reimbursement for so-called “low severity” inpatient stays that it has said will be “comparable” to observation rates. This policy will take the place of Aetna’s (and essentially every other insurer’s) long-standing approach of denying inpatient stays it deems medically unnecessary and then, in most instances, downgrading them to outpatient observation status. Instead, Aetna will approve these inpatient stays but reimburse hospitals at a lower rate it determined unilaterally outside of the good faith contract and rate negotiation process. This policy only will apply to Aetna’s Medicare Advantage and dual eligible lines of business. 

The letter discusses the impact the policy could have on beneficiaries’ and regulators’ ability to assess the quality of Aetna’s coverage; how it could circumvent established regulatory standards regarding coverage for Medicare Advantage beneficiaries; and “further stress an already financially unstable health care system at a time when hospital costs for caring for patients continue to rise.”