Hospitals and payors both lean on commercial criteria sets to decide whether care is medically necessary. Two names come up constantly: InterQual and MCG. They are tools, not law, and the rules about how they can be used depend on the payor. This guide covers where they fit in a review and what CMS changed for Medicare Advantage in 2024.
Where InterQual and MCG Clinical Reviews Fit in Medical Necessity Review
A medical necessity review compares a patient's documented clinical status against a criteria set to decide whether an admission, a level of care, or a continued day is supported. Hospital reviewers apply InterQual or MCG, and the payor's reviewers apply the criteria the payor uses. When the two sides apply different criteria, or document to different language, disputes follow. That's why bServed's reviewers work from both, and from the specific criteria each payor applies. See Medical Necessity Review Services.
Timing matters too. Real-time utilization management means the criteria are applied while the patient is still in the hospital, starting in the Emergency Department and continuing every day through inpatient concurrent review services. Documentation can still be corrected during the stay. After discharge it can't.
What the CMS 2024 Rule Changed for Medicare Advantage
CMS's CY2024 final rule (CMS-4201-F), with Medicare Advantage requirements effective January 1, 2024, set limits on how plans use criteria like these[2][3].
Under 42 CFR §422.101, a plan may create internal coverage criteria only when Medicare's own criteria are not fully established, and it must make them publicly accessible[1]. MCG's summary of the rule says a plan may choose to use a product "such as InterQual or MCG, or something similar" to help create those internal criteria only when those requirements are met[2].
For inpatient admissions, Medicare Advantage plans must follow the two-midnight rule and the Inpatient Only List[2]. A physician's overview in The Hospitalist adds that the rule "limits the use of any screening criteria, such as InterQual or MCG, specifically regarding the determination of status," while plans can still deny inpatient status for lack of medical necessity[3].
In practice, criteria are still part of the conversation, but for inpatient status the two-midnight rule has to be honored. See Observation vs. Inpatient Status Review for how status is decided, and When Medicare Advantage Denies a Continued Stay, Ask Which Criteria It Used for the continued-stay side.
Practical Takeaways
- Know which criteria set each payor applies, and write documentation to that set
- Update the documentation every day, as the patient's condition changes, not at the end of the stay
- For Medicare Advantage denials, ask whether the denial rests on Medicare's own rules or on the plan's internal criteria
- Bring physician advisors into borderline and disputed cases early
Where bServed Fits
bServed's reviewers apply InterQual and MCG criteria in real time, around the clock, with physician advisors involved in borderline and disputed cases. At Hospital 4, replacing inconsistent daily review with a structured medical necessity workflow cut concurrent denials by 40% and brought the observation rate down to 30% from 70%.
Sources
[1] 42 CFR §422.101, Requirements relating to basic benefits (Legal Information Institute)
[2] MCG, "MCG and the CMS 2024 Medicare Advantage Final Rule (CMS 4201-F)," May 8, 2023 (a criteria vendor's summary of the rule)
[3] Rob Craven, MD, "CMS Update to the Two-midnight Rule," The Hospitalist, August 1, 2024