The Inpatient-Only List is Back – Adjust Accordingly

Prepare for the change with the biggest impact from CMS’ Proposed 2022 OPPS Rule

In addition to proposing new payment rates for hospital outpatient prospective payment system (OPPS) and ambulatory surgical center (ASC) services, the 2022 Medicare OPPS/ASC proposed rule contains other change proposals that providers should be aware of. One critical change that will have a big impact is the reversal of last year’s initiative to eliminate the inpatient-only (IPO) list.

Preparing for the IPO List to be Reinstated in 2022

In a reversal of last year’s OPPS/ASC Final Rule, the 2022 proposed rule halts the initiative to eliminate the IPO list and adds back the 298 services that were removed as part of phase 1 in 2021. There will be a two-year exemption from RAC audits for these procedures, which include spine procedures.

Do’s and Don’ts for anyone involved with IPO procedures, from the surgeon at the bedside to the CDI specialist in the business office:


  • Patients going through IPOL procedures must be admitted to INPATIENT and should remain as ordered regardless of the length of stay.
  • Remember a general rule: Rare cases where there are unexpected complications where expected LOS is less than TWO Midnights = Observation. Unexpected complications with expected LOS beyond TWO midnights = Inpatient.
  • Outpatient procedures can qualify for Inpatient stays with careful clinical documentation of severity of illness, burden of comorbidities and intensity of services rendered.
  • Obtain a prior authorization approval for all elective surgical procedures.
  • Specify all procedures and CPT codes.
  • Update CPT codes for unexpected changes in procedure in order to reflect the complex procedure e.g., conversion from a laparoscopic to an open procedure.
  • Do contact your Physician Advisor for assistance when in doubt.


  • Don’t write OBSERVATION status for patient who are expected to go through an OUTPATIENT surgical procedure.
  • The convenience of the patient during the routine recovery period e.g., transportation to home is not an indication for change to OBSERVATION status.
  • Don’t forget to update the Procedure/ CPT if indicated. 
  • Don’t forget to dictate timely operative note which helps timely coding and accuracy of billing.
  • Routine Recovery Time Does Not Equal Observation.
  • Do not use unspecified codes when scheduling procedures, e.g., chest pain for scheduling a CABG.
  • Don’t copy and paste.
  • Don’t hesitate to contact your Utilization Management department; your patient’s physical and financial health depend on your decisions!

Our team of highly experienced healthcare experts and clinical leaders will discuss the remaining proposed rules in a series of articles with the goal of helping you effectively prepare for 2022.

To discuss these changes with an Ensemble expert, contact [email protected].