Aetna delays implementation of new MA inpatient payment policy
After receiving negative feedback from industry stakeholders on its new reimbursement approach for certain inpatient Medicare Advantage (MA) claims, Aetna recently extended the policy’s implementation date to January 1, 2026.
First announced by Aetna in August, the Level of Severity Inpatient Payment Policy was originally set to take effect this month. The policy outlines a new reimbursement approach for low-severity hospital stays that will be “comparable” to observation rates, and it will only apply to Aetna’s MA and dual eligible lines of business.
As of now, Aetna denies inpatient stays it deems medically unnecessary, often downgrading their status to outpatient observation down the line. Under the new policy, Aetna would approve these inpatient stays without a medical necessity review, paying the claim at a lower severity-level rate. If the inpatient stay meets Milliman Care Guidelines (MCG) criteria, the claim will be paid at the inpatient rate.
The controversial policy has drawn criticism from many industry groups and experts. In September, the American Hospital Association urged Aetna to rescind the policy, noting that it would circumvent MA regulatory standards, reduce appeal opportunities, create more financial instability across the healthcare system, and more.
Along with announcing the new implementation date, Aetna provided the following clarifications:
- The level of severity review will apply only to urgent/emergency inpatient stays of at least one midnight but less than five midnights
- For stays of one-to-four midnights that do not meet MCG criteria, organizations may request a severity review and engage in a discussion with an Aetna medical director
- Stays of five midnights or greater will not be subject to the severity-level review and will be paid at the inpatient diagnosis-related group rate
The rest of the policy remains unchanged, according to Aetna. Revenue integrity professionals can find the full policy on Aetna’s Availity provider portal.