PROGRAM MEMORANDUM INTERMEDIARIES
Department of Health and Human Services (DHHS)
Health Care Financing Administration (HCFA)
PM Rev. A-00-23
Date APRIL 2000
Change Request 1141
SUBJECT: Hospital Outpatient Prospective Payment System (OPPS) Implementation
Instructions
The purpose of this Program Memorandum (PM) is to provide instructions for implementation of OPPS, which will be effective for claims with dates of service on or after July 1, 2000. This payment system applies to hospital outpatient departments, community mental health centers (CMHCs) and for limited services, as described in "Background" below, provided by comprehensive outpatient rehabilitation facilities (CORFs), home health agencies (HHAs) or to hospice patients for the treatment of a non-terminal illness. It does not apply to critical access hospitals (CAHs) or hospitals in Maryland that are excluded from this system because they qualify under §1814 (b) (3) of the Social Security Act (the Act) for payment under the State's payment system. The excluded services are limited to those paid under the State's payment system as described in §1814 (b) (3) of the Act. In addition, Indian health service hospitals will be excluded initially, but will be included under OPPS in the future. Payment under this system will result in discontinuation of the blended payment method for radiology and other diagnostic services and ambulatory surgical center (ASC) services provided in a hospital outpatient department. This PM should be used in conjunction with Transmittal 1787 of the Part A Intermediary Manual (MIM), which contained instructions for reporting HCPCS, units, and line item dates of service, PM A-99-41 and A-00-07 which contain instructions for hospital reporting of modifiers, and PM A-00-21 which contained specifications for the revised outpatient code editor. It supersedes instructions currently contained in §§3626.4, 3627.2, 3627.9 and 3631 of the MIM.
Background
Section 1833 (t) of the Act as added to the Act by §4523 of the Balanced Budget Act (BBA) of 1997, authorizes HCFA to implement a Medicare PPS for:
o Hospital outpatient services, including partial hospitalization services;
o Certain Part B services furnished to hospital inpatients who have no Part A coverage;
o Partial hospitalization services furnished by CMHCs;
o Vaccines, splints, casts and antigens provided by HHAs that provide medical and other health services;
o Vaccines provided by CORFs; and
o Splints, casts, and antigens provided to hospice patients for the treatment of a non-terminal illness.
A proposed regulation discussing HCFA's proposal to implement OPPS was published on September 8, 1998. The proposed rule originally provided for a 60 day comment period, however, the comment period was extended four times and closed on July 30, 1999.
HCFA Pub. 60A
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On November 29, 1999 President Clinton signed new legislation which incorporates the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (BBRA) that contains a number of major provisions that affect the development of the OPPS.
The hospital outpatient provisions of the BBRA provide the following:
o Establish payments under OPPS in a budget neutral manner based on estimates of amounts payable in 1999 from the Part B Trust Fund and as beneficiary coinsurance under the system in effect prior to OPPS. (Although the base rates were calculated using 1999 amounts, these amounts are increased by the hospital inpatient market basket, minus 1 percent, to arrive at the amounts that will be payable in the year 2000.)
o Extend the 5.8 percent reduction in operating costs and 10 percent reduction in capital costs (which had been due to sunset on December 31, 1999) through the first date the OPPS is implemented;
o Require annual updating of the OPPS payment weights, rates, payment adjustments and groups;
o Require annual consultation with an expert provider advisory panel in the review and updating of payment groups;
o Establish budget neutral outlier adjustments based on the charges, adjusted to costs, for all OPPS services included on the submitted outpatient bill for services furnished before January 1, 2002 and thereafter based on the individual services billed;
o Provide transitional pass-throughs for the additional costs of new and current medical devices, drugs, and biologicals for at least 2 years but not more than 3 years;
o Provide payment under OPPS for implantable devices including durable medical equipment (DME), prosthetics and those used in diagnostic testing;
o Establish transitional payments to limit provider's losses under OPPS; the additional payments are for 3 1/2 years for CMHCs and most hospitals, and permanent for the 10 cancer hospitals; and
o Limit beneficiary coinsurance for an individual service paid under OPPS to the inpatient hospital deductible.
The Secretary has the authority under the §1833 (t) of the Act to determine which services are included (with the exception of ambulance services for which a fee schedule is being separately created). We will continue to pay for clinical diagnostic laboratory services, orthotics, prosthetics, (except as noted above) and for take home surgical dressings on their respective fee schedules, for chronic dialysis using the composite rate, for screening mammographies based on the current payment limitation and for outpatient rehabilitation services (physical therapy including speech language pathology and occupational therapy) under the Medicare Physician Fee Schedule. Acute dialysis, e.g., for poisoning will be paid under OPPS. The 10 cancer centers exempt from inpatient PPS are included in this system. Hospital outpatient services furnished by Maryland hospitals are under an inpatient PPS waiver and will not be paid under this system. CAHs will also be excluded from this payment system and will continue to be paid on a cost basis.
APC Payment Groups
Payment for services under the OPPS is calculated based on grouping outpatient services into ambulatory payment classification (APC) groups. Services within an APC are similar clinically and require similar resource use. The payment rate and coinsurance amount calculated for an APC apply to all of the services within the APC. APCs require no changes to the billing form, however, hospitals are required to include HCPCS codes for all services paid under OPPS. A hospital may require a
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number of APC payments for the services furnished to a patient on a single day, however, multiple surgical procedures furnished on the same day are subject to discounting.
Calculation of APC Payment Rates
o A group's relative weight is calculated based on the median cost (operating and capital ) of the services included in the group;
o Median costs were developed from a database of CY 96 hospital outpatient claims using "the most recent" cost report data available;
o Used hospital-specific, department-specific cost-to-charge ratios to convert billed charges to median costs for each group;
o Weights are converted to payment rates using a conversion factor which takes into account group weights, the volume of services for each group, and an expenditure target specified in the law; and
o Hospital outpatient payments that would have been effective in CY 99 are calculated, in a budget neutral basis, to equal projected 1999 payments to hospitals for services included under the OPPS.
The rates that will go into effect when OPPS is implemented are the 1999 rates updated by the hospital market basket minus one percent.
Packaging
o Initially, only minimal packaging, i.e., payment for a procedure or medical visit will not include payment for the related ancillary services such as laboratory tests or x-rays;
o Payment for clinical diagnostic laboratory tests which are paid under the clinical diagnostic fee schedule and radiology and other diagnostic services paid under OPPS will be made in addition to the OPPS payment for a surgical procedure or medical visit performed on the same day; and
o APC payments will include certain packaged items, such as anesthesia, supplies, certain drugs and the use of recovery and observation rooms.
Discounting
o Multiple surgical procedures furnished during the same operative session will be discounted;
o The full amount is paid for the surgical procedure with the highest weight; 50 percent is paid for any other surgical procedure(s) performed at the same time;
o Similar discounting occurs now under the physician fee schedule and the payment system for ASCs;
o Surgical procedures terminated after a patient is prepared for surgery but before induction of anesthesia will be paid at 50 percent of the APC payment; and
o When multiple surgical procedures are performed during the same operative session, beneficiary coinsurance is discounted in proportion to the APC payment.
Payment Adjustments
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o BBA requires payments to be adjusted to reflect geographic differences in labor-related costs; and o The Secretary may also establish other adjustments or special adjustments for certain classes of hospitals.
Geographic Adjustment
o Adjustments for differences in wages across geographic areas will be made using inpatient hospital PPS wage index (post-reclassification, post-floor); and
o It is estimated that 60 percent of the group payment represents labor-related costs and will be subject to the geographic adjustment.
Updates
o HCFA will annually review/update groups, relative weights, wage indexes and other adjustments;
o BBA requires rates to be updated annually based on the hospital market basket less one percent for the years 2000 through 2002, and based on the hospital market basket for subsequent years; and
o New outpatient procedures and services will be added to the payment system as needed and weights will be adjusted to reflect changes in outpatient care.
Partial Hospitalization Services
Claims submitted by hospitals and CMHCs for partial hospitalization services must include a mental health diagnosis and indicate for each day of service, the HCPCS and revenue codes that best describe the services furnished. The OCE will determine that, for each day of service appropriate codes are identified and that the services reflect the intensive nature of a partial hospitalization program. For example, the OCE will determine that at least three partial hospitalization HCPCS codes, as indicated in MIM §§3651 and 3661, are included for each day of service, one of which must be a psychotherapy HCPCS code (other than brief psychotherapy). For claims that pass these OCE edits each day of service will be assigned to the partial hospitalization APC and the partial hospitalization per diem amount will be paid. Claims that include days that do not pass these edits will be identified for further review.
The total amount payable for psychiatric services furnished in a hospital outpatient department (not under the partial hospitalization program) for an individual for one day will be limited to the APC payment amount for partial hospitalization.
Instruct your hospital outpatient departments to report partial hospitalization services under bill type 13X with condition code 41. This supersedes instructions in §3661of the MIM which currently allows these claims to be billed under bill type 14X .
Coding for Clinic and Emergency Visits
Formerly hospitals could report CPT code 99201 to indicate a visit of any type. Under OPPS, 31 codes are used to indicate visits, with payment differentials for more or less intense services. Hospitals should code the site of the visit and the level of intensity, using the following codes: 92002, 92004, 92012, 92014, 99201, 99202, 99203, 99204, 99205, 99211, 99212, 99213, 99214, 99215, 99241, 99242, 99243, 99244, 99245, 99271, 99272, 99273, 99274, 99275, 99281, 99282, 99283, 99284, 99285, G0101, and G0175. Because CPT is more descriptive of practitioner than of facility services, hospitals should use CPT guidelines when applicable, or crosswalk hospital coding structures to CPT. For example, a hospital that has 8 levels of emergency and trauma care, depending on nursing ratios, should walk those 8 levels to the CPT codes for emergency care.
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HCPCS / Revenue Code Chart
The following chart reflects HCPCS coding required to be reported under OPPS by hospital outpatient departments. This chart supersedes coding instructions and edit requirements for outpatient surgery, diagnostic and medical services and radiology services represented in §§3626.4, 3627.9 and 3631 of the MIM. It is intended to be used as a guide by hospitals to assist them in reporting services rendered. Note that this chart does not represent all HCPCS coding subject to OPPS but will be expanded at a later date.
Revenue Code
HCPCS Code
Description
* 10040-69990 Surgical Procedure * 92950-92961 Cardiovascular * 96570, 96571 Photodynamic Therapy * 99170, 99185, 99186 Other Services and Procedures * 99291-99292 Critical Care * 99440 Newborn Care * 90782-90799 Therapeutic or Diagnostic Injections * D0150, D0240-D0274, Dental Services D0277, D0460, D0472- D0999, D1510-D1550, D2970, D2999, D3460, D3999, D4260-D4264, D4270-D4273, D4355-D4381, D5911-D5912, D5983-D5985, D5987, D6920, D7110- D7260, D7291, D7940, D9630, D9930, D9940, D9950-D9952 * 92502-92596, 92599 Otorhinolaryngologic Services (ENT) 278 E0749, E0782, E0783, E0785 Implanted Durable Medical Equipment 278 E0751, E0753, L8600, L8603, Implanted Prosthetic Devices L8610, L8612, L8614, L8619, L8630, L8641, L8642, L8658, L8670, L8699 302 86485-86586 Immunology 305 85060-85102, 86077-86079 Hematology Revenue Code
HCPCS Code
Description
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31X 80500-80502 Pathology - Lab 310 88300-88365, 88399 Surgical Pathology 311 88104-88125, 88160-88199 Cytopathology 32X 70010-76999 Diagnostic Radiology 333 77261-77799 Radiation Oncology 34X 78000-79999 Nuclear Medicine 37X 99141-99142 Anesthesia 413 99183 Other Services and Procedures 45X 99281-99285 Emergency 46X 94010-94799 Pulmonary Function 480 93600-93790, 93799, G0166 Intra Electrophysiological Procedures and Other Vascular Studies 481 93501-93571 Cardiac Catheterization 482 93015-93024 Stress Test 483 93303-93350 Echocardiography 5lX 92002-92499 Ophthalmological Services 51X 99201, 99215, 99241-99245, Clinic Visit 99271-99275 510, 517, 519 95144-95149, 95163, 95170, Allergen Immunotherapy 95180, 95199 519 95805-95811 Sleep Testing 530 98925-98929 Osteopathic Manipulative Procedures 636 A4642, A9500, A9605 Radionclides 636 90296-90379, 90385, 90389- Immune Globulins 90396 636 90476-90665, 90675-90749 Vaccines, Toxoids 73X G0004-G0006, G0015 Event Recording ECG 730 93005-93014, 93040-93224, Electrocardiograms (ECGs) 93278 Revenue Code
HCPCS Code
Description
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731 93225-93272 Holter Monitor 75X 95812-95827, 95950-95962 Electroencephalogram (EEG) 762 99217-99220 Observation 771 G0008-G0010 Vaccine Administration 88X 90935-90999 Non-ESRD Dialysis 901 90870,90871 Psychiatry 903 90910, 90911, 90812-90815, Psychiatry 90823, 90824, 90826-90829 909 90880 Psychiatry 910 90801, 90802, 90865, 90899 Psychiatry 914 90804-90809, 90816-90819, Psychiatry 90821, 90822, 90845, 90862 915 90853, 90857 Psychiatry 916 90846, 90847, 90849 Psychiatry 917 90901-90911 Biofeedback 918 96100- 96117 Central Nervous System Assessments / Tests 92X 95829-95857, 95900-95937, Miscellaneous Neurological 95970-95999 Procedures 920, 929 93875-93990 Non Invasive Vascular Diagnosis Studies 922 95858-95875 Electromyography (EMG) 924 95004-95078 Allergy Test 940 96900-96999 Special Dermatological Procedures 940 98940-98942 Chiropractic Manipulative Treatment 940 99195 Other Services and Procedures 943 93797-93798 Cardiac Rehabilitation *Revenue codes have not been identified for these procedures, as they can be performed in a number of revenue centers within a hospital, such as emergency room (450), operating room (360), or clinic (510). Instruct your hospitals to report these HCPCS codes under the revenue center where they were performed.
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NOTE: The listing of HCPCS codes contained in the above chart does not assure coverage of the specific service. Current coverage criteria apply.
Additional Edit Requirements
Edit to assure that HCPCS are reported for all services paid under OPPS. Do not install additional edits for the matching of revenue and HCPCS codes.
New HCPCS Coding Requirements for CORFs and HHAs
As stated in the background section above, payments will be made under OPPS:
o To CORFs (bill type 75X) for vaccines;
o To HHAs (bill type 34X) for splints, casts, vaccines and antigens when provided as a medical and other health service; and
o For splints, casts and antigens when provided to hospice patients for treatment of a non-terminal illness by other than a hospital outpatient department. This requires reporting of condition code 07.
As a result, instruct your CORFs, HHAs, and other providers to report HCPCS for these services, in order to assure payment under this system. Payment will continue to be made for vaccines provided to hospice patients by the Medicare Part B carrier. The appropriate HCPCS codes are as follows:
Antigens 95144 - 95149, 95165, 95170, 95180 and 95199
Vaccines 90657 - 90659, 90732, 90744, 90746, 90748, G0008, G0009, and G0010
Splints 29105-29131, 29505-29515
Casts 29000-29085, 29305, 29450, 29700-29750, 29799
NOTE: Advise your HHAs to report the above HCPCS codes with the exception of vaccines under
Revenue Code 550 (Skilled Nursing) and advise your CORFs to report these codes using Revenue Code 510 (Clinic). The only time revenue codes 550 and 510 should be reported is when the HHA or CORF are billing for the above revenue codes. See §3660.7 of the MIM for the reporting of vaccines by HCPCS codes.
Deductible Application
PRICER applies deductible to OPPS services on a claim and you apply the deductible to other types of services subject to other payment methods on the same claim. PRICER will automatically apply deductible to the APC line item with the largest national unadjusted coinsurance as a percent of the APC payment and then to the next largest coinsurance as a percent of the APC payment and so on until the deductible is met or no other payments can be used to satisfy the deductible. This method of applying the deductible is the most advantageous for the beneficiary. If less than $100 or less than the beneficiary's remaining deductible amount is applied, the total deductible applied to the OPPS claim must be added to any applicable deductible for any other types of payments on the same claim and then be submitted to CWF. If the amount submitted to CWF is under or over applied, the claim must be repriced by the PRICER software.
Deductible does not apply to the influenza virus vaccines, pneumococcal pneumonia vaccine, clinical diagnostic laboratory services (which includes screening pap smears), screening mammographies,
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screening pelvic examinations, and screening prostate examinations. Only influenza virus vaccine, pneumococcal pneumonia vaccine and screening pelvic examinations are subject to OPPS.
Coinsurance
Under current law, coinsurance for hospital outpatient and CMHC services is based on 20 percent of the hospital's or CMHC's billed charges. OPPS freezes coinsurance at 20 percent of the national median charge for the services within each APC (wage adjusted for the provider's geographic area) but coinsurance for an APC cannot be less than 20 percent of the APC payment rate. As the total payment to the provider increases each year based on market basket updates, the present or frozen coinsurance amount will become a smaller portion of the total payment, until coinsurance represents 20 percent of the total payment. Once coinsurance becomes 20 percent of the payment amount, the annual updates will also increase coinsurance so that it continues to account for 20 percent of the total payment. As previously stated, the wage-adjusted coinsurance for a service under OPPS cannot exceed the inpatient deductible amount.
For screening colonoscopies and sigmoidoscopies, the coinsurance amount is 25 percent of the payment rate. The APC payment rate is limited to the lower of the hospital outpatient rate or the ASC payment rate. The payment rate for screening barium enemas is the same as that for diagnostic barium enemas. The coinsurance amount for screening barium enemas is 20 percent of the APC payment rate.
Coinsurance does not apply to influenza virus vaccines, pneumococcal pneumonia vaccines and clinical diagnostic laboratory services (which includes screening pap smears and screening prostate specific antigen testing).
See coinsurance calculations below for more detail.
Coinsurance Election
The transition to the standard Medicare coinsurance rate (20 percent of the APC payment rate) will be gradual. For those APC groups for which coinsurance is currently a relatively high proportion of the total payment, the process will be correspondingly lengthy. The law offers hospitals the option of electing to reduce coinsurance amounts and advertise their reduced rates for all OPPS services. They may elect to receive a coinsurance payment from Medicare beneficiaries that is less than the wage adjusted coinsurance amount per APC. This coinsurance reduction must be offered to all Medicare beneficiaries. They should review the list of APCs and their respective coinsurance amounts that is published in the Federal Register as a final rule. After adjusting those coinsurance amounts for the wage index applicable to their MSA, they must notify their intermediary if they wish to charge their Medicare beneficiaries a lessor amount until the following calendar year. The first election must be filed by June 1, 2000, for the period July 1, 2000 through December 31, 2000. Future calendar year elections must be made by December 1st of the year preceding the calendar year for which the election is being made. The lessor amount elected may not be less than 20 percent of the wage adjusted APC payment amount. The lessor amount elected may not be greater than the inpatient hospital deductible for that calendar year ($776 for 2000). The lessor amount elected will not be wage adjusted by you or HCFA. Once an election to reduce coinsurance is made, it cannot be rescinded or changed until the next calendar year. National unadjusted and minimum unadjusted coinsurance amounts will be posted in the addenda of the OPPS final rule (HCFA-1005FC) on HCFA's web site (www.hcfa.gov).
This coinsurance election does not apply to partial hospitalization services furnished by CHMCs, vaccines provided by a CORF, vaccines, splints, casts and antigens provided by HHAs or splints, casts, and antigens provided to a hospice patient for the treatment of a non-terminal illness. It also does not apply to screening colonoscopies, screening sigmoidoscopies, or screening barium enemas.
Advise hospitals to utilize the following format for notification to you:
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Provider number 876543 Provider name XYZ Hospital Effective from 7/1/2000 - 12/31/2000 Provider contact Joe Smith Phone # 123-456-7890 x123 Contact E Mail jsmith@XYZ.ORG Fax # 123-456-7891 XYZ Hospital elects to reduce coinsurance to the amount shown for the following APCs: APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ APC____ Coinsurance___.__ Return to: Provider Audit ÷amp; Reimbursement Dept. Attn: John Doe Intermediary Address
You must send an acknowledgment to the hospital that their election has been received within 15 calendar days of receipt. The reduced coinsurance amount, elected by the hospital, must be validated to ensure it is not less than 20 percent of the wage adjusted APC amount nor more than the inpatient deductible for the year of the election.
Calculating the Medicare Payment Amount and Coinsurance
A program payment percentage is calculated for each APC by subtracting the unadjusted national coinsurance amount for the APC from the unadjusted payment rate and dividing the result by the unadjusted payment rate. The payment rate for each APC group is the basis for determining the total payment (subject to wage-index adjustment) a hospital will receive from the beneficiary and the Medicare program. (A hospital that elects to reduce coinsurance, as described in "Coinsurance Election" above, may receive a total payment that is less than the APC payment rate.) The Medicare payment amount takes into account the wage index adjustment and the beneficiary deductible and coinsurance amounts. In addition, the amount calculated for an APC group applies to all the services that are classified within that APC group. The Medicare payment amount for a specific service classified within an APC group under OPPS is calculated as follows:
Step 1 Apply the appropriate wage index adjustment to the payment rate that is set annually for each APC group;
Step 2 Subtract from the adjusted APC payment rate the amount of any applicable deductible;
Step 3 Multiply the adjusted APC payment rate, from which the applicable deductible has been subtracted, by the program payment percentage determined for the APC group or 80 percent, whichever is lower. This amount is the preliminary Medicare payment amount;
Step 4 Subtract the preliminary Medicare payment amount from the adjusted APC payment rate less the amount of any applicable deductible. If the resulting amount does not exceed the annual hospital inpatient deductible amount for the calendar year, the resulting amount is the beneficiary coinsurance amount. If the resulting amount exceeds the annual inpatient hospital deductible amount, the beneficiary coinsurance amount is limited to the inpatient hospital deductible and the Medicare program pays the difference to the provider;
Step 5 If the wage-index adjusted coinsurance amount for the APC is reduced because it exceeds the inpatient deductible amount for the calendar year, add the amount of this reduction to the amount determined in Step 3 above to get the final Medicare payment amount.
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Example 1
The wage-adjusted payment rate for an APC is $300; the program payment percentage for the APC group is 70 percent; the wage-adjusted coinsurance amount for the APC group is $90; and the beneficiary has not yet satisfied any portion of his or her $100 annual Part B deductible.
(A) Adjusted APC payment rate: $300.
(B) Subtract the applicable deductible: $300 - $100 = $200.
(C) Multiply the remainder by the program payment percentage to determine the preliminary
Medicare payment amount: 0.7 x $200 = $140.
(D) Subtract the preliminary Medicare payment amount from the adjusted APC payment rate less any unmet deductible to determine the coinsurance amount, which cannot exceed the inpatient hospital deductible for the calendar year: $200 - $140 = $60.
(E) Calculate the final Medicare payment amount by adding the preliminary Medicare payment amount determined in step (C) to the amount that the coinsurance was reduced as a result of the inpatient hospital deductible limitation. $140 + $0 = $140.
In this case, the beneficiary pays a deductible of $100 and a $60 coinsurance, and the program pays $140, for a total payment to the provider of $300. Applying the program payment percentage ensures that the program and the beneficiary pay the same proportion of payment that they would have paid if no deductible were taken.
If the annual Part B deductible has already been satisfied, the calculation is as follows:
(A) Adjusted APC payment rate: $300.
(B) Subtract the applicable deductible: $300 - 0 = $300.
(C) Multiply the remainder by the program payment percentage to determine the preliminary
Medicare payment amount: 0.7 x $300 = $210.
(D) Subtract the preliminary Medicare payment amount from the adjusted APC payment rate less deductible to determine the coinsurance amount. The coinsurance amount cannot exceed the amount of the inpatient hospital deductible for the calendar year: $300 - $210 = $90.
(E) Calculate the final Medicare payment amount by adding the preliminary Medicare payment amount determined in step (C) to the amount that the coinsurance was reduced as a result of the inpatient hospital deductible limitation: $210 + $0 = $210.
In this case, the beneficiary makes a $90 coinsurance payment and the program pays $210, for a total payment to the provider of $300.
Example 2
This example illustrates a case in which the inpatient hospital deductible limit on coinsurance amount applies. Assume that the wage-adjusted payment rate for an APC is $2,000; the wage-adjusted coinsurance amount for the APC is $900; the program payment percentage is 55 percent; the inpatient hospital deductible amount for the calendar year is $776 and the beneficiary has not yet satisfied any portion of his or her $100 Part B deductible.
(A) Adjusted APC payment rate: $2,000.
(B) Subtract the applicable deductible: $2,000 - $100 = $1,900.
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(C) Multiply the remainder by the program payment percentage to determine the preliminary
Medicare payment amount: 0.55 x $1,900 = $1,045.
(D) Subtract the preliminary Medicare payment amount from the adjusted APC payment rate less deductible to determine the coinsurance amount. The coinsurance amount cannot exceed the inpatient hospital deductible amount of $776: $1,900 - $1,045 = $855, but the coinsurance is limited to $776.
(E) Calculate the final Medicare payment amount by adding the preliminary Medicare payment amount determined in step (C) to the amount that the coinsurance was reduced as a result of the inpatient hospital deductible limitation ($855 - $776 = $79). $1,045 + $79 = $1,124.
In this case, the beneficiary pays a deductible of $100 and a coinsurance that is limited to $776 and the program pays $1,124 (which includes the amount of the reduction in beneficiary coinsurance due to the inpatient hospital deductible limitation) for a total payment to the provider of $2,000.
Outpatient Provider Specific File
The outpatient provider (OPROV) specific file is variable length with a minimum size of 100 positions and contains the required information about each provider to enable the pricing software to calculate the payment amount. Maintain the accuracy of the data in accordance with the following criteria.
Whenever the status of any element changes, prepare an additional record showing the effective date. For example, when a provider's FY beginning date changes as a result of a change in ownership or other ÷quot;good cause,÷quot; make an additional record showing the effective date of the change.
The format and data shown below are required by the outpatient PRICER program and by the outpatient provider specific file you submit every 3 months.
File Position Format Title 1-8 X(8) National Provider Identifier (NPI) 9-10 X(2) NPI Filler 11-16 X(6) Provider Oscar Number 17-24 9(8) Effective Date 25-32 9(8) Fiscal Year Beginning Date 33-40 9(8) Report Date 41-48 9(8) Termination Date 49 X Waiver Indicator 50-54 9(5) Intermediary Number 55-56 X(2) Provider Type 57 X Filler 58 X Change Code for Wage Index Reclassification 59-62 X(4) Actual Geographic Location--MSA 63-66 X(4) Wage Index Location--MSA 67-70 9V9(3) Cost of Living Adjustment 71-75 9(5) Bed Size 76-79 9V9(3) Outpatient Cost to Charge Ratio - NEW
80-96 X(17) Filler 97-100 9(4) Reduced Coinsurance Trailer Count - NEW
Enter the number of APCs the provider has elected to reduce coinsurance for. Cannot be greater than 0999.
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Reduced Coinsurance Trailer -- Occurs 0 to 9999 times depending on the Reduced Coinsurance Trailer Count in positions 97-100. Due to systems capacity limitations the maximum number of reduced coinsurance trailers allowable is 999 at this time.
9(4) APC Classification - NEW
Enter the four digit APC classification the provider has elected to reduce coinsurance for. 9(4)V9(2) Reduced Coinsurance Amount - NEW
Enter the reduced coinsurance amount elected by the provider. The Standard System will verify that the last position on this record is equal to the number in position 97-100 times 10 plus 100.
OPPS PRICER
Outpatient PRICER determines the amount to pay as well as deductions for deductible and coinsurance.
This HCFA developed software determines the APC line item price based on data from the OPROV specific file, your beneficiary deductible record and the OCE output file. The software will output a data record with the following information:
o All information passed from OCE;
o The APC line item payment amount;
o The APC line item deductible;
o The APC line item coinsurance amount;
o The total deductible applied to the OPPS services on the claim;
o The total outlier amount for the claim to be paid in addition to line item APC payments and to be output to CWF via value code 17 same as the current process for inpatient outlier payments;
o The partial hospitalization payment amount if applicable; and
o A PRICER assigned review code to indicate why/how PRICER rejected or paid the claim.
See your PRICER implementation guide for information concerning PRICER processing reports, input parameters, and data requirements.
Transitional Pass-Throughs for Designated Drugs or Biologicals
Certain current designated drugs and biologicals will be assigned to special APC's and identified by the OCE as eligible for payment at 95 percent of the average wholesale price. PRICER will determine the proper payment amount for these APCs as well as the coinsurance and any applicable deductible. All related payment calculations will be returned on the same APC line and identified as a designated drug and biological. Certain new designated drugs and biologicals may be approved for payment and their payment will be calculated in the same manner as listed above for current designated drugs and biologicals. These new designated drugs and biologicals will be identified separately from the current designated drugs and biologicals.
Transitional Pass-Throughs for Designated Devices
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Certain designated new devices will be assigned to APCs and identified by the OCE as eligible for payment based on the reasonable cost of the new device reduced by the amount included in the APC for the procedure that reflects payment for the old device. PRICER will determine the proper payment amount for these APCs as well as the coinsurance and any applicable deductible. All related payment calculations will be returned on the same APC line and identified as a designated new device.
Outlier Adjustments
PRICER will calculate outlier payments on a claim by claim basis. The outlier payment will be calculated by:
o Calculating the costs related to the OPPS services on the claim by multiplying the total charges for covered OPPS services by an outpatient cost to charge ratio;
o Determining whether these costs exceed 2.5 times the OPPS payments (APC payments plus any transitional pass-through amounts for drugs, biologicals and/or devices) for the claim; and
o If costs exceed 2.5 times the OPPS payments, the outlier payment is calculated as 75 percent of the amount by which the costs exceed the OPPS payments.
The result will be output from PRICER for the standard system to capture and store as value code 17 (outlier amounts), which is currently used to identify outliers.
Transitional Corridor Payments
Beginning August 1, 2000, and every month thereafter until further notice, the standard system maintainers must provide intermediaries with software that gathers all data required to calculate a transitional outpatient payment (TOP) amount for each hospital and CMHC. The software must calculate and pay the TOP amount for OPPS services on claims processed and paid during the preceding month, maintain an audit trail (including the ability to generate a hardcopy report) of these TOP amounts and transfer to the PS÷amp;R system any necessary data. TOP amounts should be made before the next month begins and are not subject to normal payment floor requirements.
Eight items contained in the provider file and defined under the OPROV Specific File section above are needed to calculate the TOP amount for each hospital or CMHC. They are the provider number, fiscal year begin date, the provider type, change code for wage index reclassification, actual geographic location--MSA, wage index location--MSA, bed size and outpatient cost to charge ratio. One additional item will be output from the PRICER software in 9(7)V99 format. It is the outlier payment amount. The standard system will sum the following items for use in steps 1 ÷amp; 2 below: total charges for all covered OPPS services on the claim, total OPPS Medicare program payments on the claim, total unreduced OPPS coinsurance on the claim and total OPPS deductible on the claim.
The TOP amount is calculated as follows:
Step 1 Find the total charges for covered services for all OPPS services on claims paid during the month and reduce the total charges to cost by multiplying them by the outpatient cost to charge ratio, and multiply this amount by a payment to cost ratio of .8.
Step 2 Find the total Medicare program payments, unreduced coinsurance and deductible applied for all APCs as well as all outlier payments and transitional pass-through payments for drugs, biologicals and/or devices for those same claims paid during the month under OPPS. If the result is greater than the result of step 1, go to step 9. No transitional payment is due this month.
Step 3 If the hospital is a small rural hospital with less than 101 beds or a cancer hospital go to step 4 only. If any other type of hospital, divide the result of step 2 by the result of step 1, skip step 4 and perform step 5, 6, 7, or 8 as appropriate.
Step 4 If the hospital is a small rural hospital with less than 101 beds or a cancer hospital subtract the result of step 2 from the result of step 1 and pay .85 times this amount. Do not perform steps 5-8.
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Step 5 If the result of step 3 is greater than or equal to .9 and less than 1.0, subtract the result of step 2 from the result of step 1 and multiply the difference by .8 and pay .85 times this amount.
Step 6 If the result of step 3 is greater than or equal to .8 and less than .9, subtract .7 times the result of step 2 from .71 times the result of step 1 and pay .85 times this amount.
Step 7 If the result of step 3 is greater than or equal to .7 and less than .8, subtract .6 times the result of step 2 from .63 times the result of step 1 and pay .85 times this amount.
Step 8 If the result of step 3 is less than .7, multiply the result of step 1 by .21 and pay .85 times this amount.
Step 9 When the result of step 2 is greater than the result of step 1 for the final month of a providers cost report period, do nothing more. When the result of step 2 is greater than the result of step 1 for any other month, store all step 1 and step 2 totals and include these totals with the totals for the next months TOP calculation.
Corneal Tissue
Corneal tissue will be paid on a cost basis, not under OPPS. To receive cost based reimbursement advise your hospitals to bill for corneal tissue using HCPCS code V2785.
Appropriate Bill Types
The following bill types are subject to OPPS:
o All outpatient hospital Part B bills (bill types 12X, 13X with condition code 41, 13X without condition code 41 or 14X) with the exception of bills from hospitals in Maryland, Indian health service, and CAH bills;
o CMHC bills (bill type 76X);
o CORF and HHA bills containing certain HCPCS codes as described in ÷quot;New HCPCS Coding Requirements for CORFs and HHAs" above (bill types 75X or 34X); and
o Any bill containing a condition code 07 with certain HCPCS codes as described in ÷quot;New HCPCS Coding Requirements for CORFs and HHAs÷quot; above.
NOTE: For bill type 34X only vaccines and their administration, splints, casts, and antigens will be paid under OPPS. For bill type 75X only vaccines and their administration will be paid under OPPS. For bills containing condition code 07 only splints, casts, and antigens will be paid under OPPS.
Discontinuation of Bill Type 83X for Hospitals Subject to OPPS
Since bill type 83X ÷quot;Ambulatory Surgical Center Services to Hospital Outpatients÷quot; will not be utilized under OPPS, hospitals are required, beginning with claims with dates of service on or after July 1, 2000, to report in Form Locator 6 "Statement Covers Period From Date" the earliest date
services were rendered. As a result, pre-operative laboratory services will always have a line item date of service within the from and through dates on the claim. The instructions in §3626.4 of the MIM only apply to claims with dates of service prior to July 1, 2000.
Indian health service hospitals continue to bill for surgeries utilizing bill type 83X.
Discontinuation of Value Code 05 Reporting
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With line item date of service reporting, there will be no way to correctly allocate professional component charges reported in value code 05 to specific line items on the claim. As a result, advise your hospitals that currently report professional component charges in value code 05 to no longer include the professional component amount in their charges and to discontinue reporting the professional component in value code 05.
Provider Reporting Requirements
Advise your providers paid under OPPS not to include June 2000 and July 2000 dates of service on the same claim. Standard systems must edit to assure that a hospital or CMHC claim does not contain dates of service that span June 2000 and July 2000. In addition, advise your hospitals and CMHCs that every effort should be made to report all services performed on the same day on the same claim to assure proper payment under OPPS. Return claims submitted for the same date of service to the provider (except duplicates or those containing condition code 20 or 21) with a notification that an adjustment bill should be submitted.
Procedures for Submitting Late Charges
Hospitals and CMHCs may not submit a late charge bill (Step 5 in the third position of the bill type) for bill types 12X, 13X, 14X, and 76X effective for claims with dates of service on or after July 1, 2000. They must submit an adjustment bill for any services required to be billed with HCPCS codes, units and line item dates of service by reporting a 7 in the third position of the bill type. Separate bills containing only late charges will not be permitted.
The submission of an adjustment bill, instead of a late charge bill, will ensure proper duplicate detection, bundling, correct application of coverage policies and proper editing by OCE and payment under OPPS.
Subject adjustment claims to the same edits that you apply to initial claims.
Instructions in §3603.B of the MIM regarding monthly billing of repetitive services still apply.
Proper Reporting of Condition Code G0 (Zero)
Hospitals report Condition Code G0 on FLs 24-30 when multiple medical visits occurred on the same day in the same revenue center but the visits were distinct and constituted independent visits. An example of such a situation would be a beneficiary going to the emergency room twice on the same day, in the morning for a broken arm and later for chest pain.
Proper reporting of Condition Code G0 allows for payment under OPPS in this situation. The OCE contains an edit that will reject multiple medical visits on the same day with the same revenue code without the presence of Condition Code G0.
Proper Reporting of Condition Codes 20 and 21
Hospitals and CMHCs may report condition codes 20 and 21 when they realize the services are excluded from coverage but:
o The beneficiary has requested a formal determination (condition code 20); or
o The provider is requesting a denial notice from Medicare to bill Medicaid or other insurers (condition code 21).
Advise your hospitals and CMHCs when billing condition codes 20 and 21 a separate claim must be submitted. Covered and non-covered services should not be reported on the same claim.
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Implanted DME, Prosthetic Devices and Diagnostic Devices
Implanted DME, implanted prosthetic devices, and implanted diagnostic devices are paid under OPPS and therefore are no longer payable under the DME/Prosthetic fee schedules. The following are the appropriate HCPCS codes for payment under OPPS.
Implanted DME: E0749, E0782 ,E0783, E0785 Implanted Prosthetic Devices: E0751, E0753, L8600, L8603, L8610, L8612, L8613, L8614, L8630, L8641, L8642, L8658, L8670, L8699 Implanted Diagnostic Device: E0616
Advise your hospitals effective with claims with dates of service on or after July 1, 2000 to discontinue billing the local carrier for these services.
This supersedes instructions in §3629A of the MIM regarding implanted devices.
Clinical Diagnostic Laboratory Services Furnished to Inpatients Under Part B
Payment for clinical diagnostic laboratory services furnished under the inpatient Part B benefit (bill type 12X) which are currently reimbursed on cost will not be paid under OPPS. Therefore, make payment for these services under the clinical diagnostic laboratory fee schedule. This supersedes instructions in §3628B of the MIM which requires payment based on a reasonable cost basis.
Advise your hospitals to report HCPCS codes for clinical diagnostic laboratory services.
Medicare Summary Notice (MSN) and Explanation of Medicare Benefits (EOMB)
As a result of implementation of OPPS, effective for claims with dates of service on or after July 1, 2000, the MSN must be modified to reflect the addition of an APC number. This APC number should be reflected next to the HCPCS code included under the "Services Provided" column, and must be within a parenthesis. The coinsurance column should reflect the coinsurance amount that the beneficiary is responsible for.
If you are still issuing the Part A EOMB, you must modify the EOMB to only reflect the coinsurance amount. Any reference to the 20 percent coinsurance calculation should be removed, as coinsurance is no longer being calculated based on 20 percent of charges.
In addition, the back of both notices must be modified to eliminate any reference made to the 20 percent coinsurance amount. In place of the current language and to be consistent, the notices should reflect the following language:
THE AMOUNT YOU MAY BE BILLED for Part B services includes:
o An annual deductible, the first $100 of Medicare Part B charges each year;
o A coinsurance amount, a percentage of the amount charged after the deductible has been met for the year; and
o Charges for services or supplies that are not covered by Medicare. You may not have to pay for certain denied services. If so, a note on the front will tell you.
The Spanish version for contractors issuing the MSN should read as follows:
La cantidad por la cual usted podr'a ser facturado incluye:
o Un deducible anual, los primeros $100 de Medicare Parte B de cargos aprobados cada
año,
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o Un coaseguro, cantidad basada en un porcentaje, cobrada después de que haya cumplido con el deducible para ese año,
o Cargos por servicios / suministros que no están cubiertos por Medicare. Es posible que usted no tenga que pagar por ciertos cargos se servicios denegados. De ser el caso, una NOTA en la parte del frente le indicará.
NOTE: Continue to print all other HCFA mandated language on the back of the notice.
Standard Paper and Electronic Remittance Advice Changes
Attachment 1 contains the 2000 version of the Standard Paper Remittance (SPR) Advice. This attachment must be read and printed in landscape. Due to the number of data elements in an SPR, an SPR must be printed and read across, rather than down, a page. If printed in a portrait format, the data in the columns to the far right will scroll to the next line, making an SPR almost illegible. This version will supplant the earlier SPR effective with implementation of OPPS. The following SPR changes are included in this version:
o The reference to HCPCS changed to "procedure code" as other code sets such as the National Drug Code (NDC) may begin to be used in addition to HCPCS in the future.
o The DRG operating amount and the DRG capital amount will no longer be reported separately. A combined DRG operating and capital amount will now be reported in the SPR to correspond to reporting of this information in the 835.
o A summary data element has been added for the TOP, a monthly provider payment which will be issued as warranted to supplement line item payments for services paid under OPPS.
o Date fields in the SPR have been expanded to enable reporting of the century. Some, but not all, SPR dates previously accommodated century reporting.
o Although previously implemented, the hemophilia add on has been added to the format document.
NOTE: Only the third bullet above is directly related to OPPS, but the remaining information must be included to reflect incremental modifications to the SPR.
As with inpatient PPS, only summary data will be reported in the SPR for OPPS. The standard systems maintainers will report detailed service line data only in version 3051.4A.01 and later 835 electronic remittance advice transactions. The Fiscal Intermediary Shared System (FISS) will continue to report claim level summary data without service line information in the version 3030M and 3051.3A 835 transactions. Providers on FISS who wish to receive service line level data must upgrade to the 835 version 3051.4A.01 transaction format.
Attachment 2 contains field characteristics for the 2000 version of the SPR and mapping information between the SPR and the 835. The FISS maintainer must expand the flat files for the supported 835 versions at the claim or line levels as appropriate to include OPPS-specific data elements (described below), and furnish relevant mapping information between those data elements and the SPR and the supported versions of the 835 (see FISS mapping-required notations in the attachment 4 implementation guide replacement pages).
Electronic remittance advice format requirements:
o Substitute the replacement pages in Attachment 3 in your hard copy version 3051.4A.01 implementation guide. These changes are also being added to version 3051.4A.01 at www.hcfa.gov/medicare/edi/edi.htm, and include:
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- 2-062-AMT02 modified to allow reporting of either inpatient or partial hospitalization per diem. NOTE: Make the same "pen and ink" change to the corresponding pages in the version 3030M and 3051.3A implementation guides. This is a claim level segment which will also need to be reported in those versions. (Since those versions were established in obsolete software which is no longer supported, replacement pages cannot be attached to this instruction for those versions.) Also report the amount of any outlier PRICER determines payable for the claim in a separate AMT loop with ZZ in AMT01 and the outlier amount in AMT02.
- 2-100.A-REF and REF02 modified to allow service line reporting of the APC and the home health Health Insurance Prospective Payment System (HIPPS, also know as the Home Health Resource) group numbers. The APC will supplant the Ambulatory Surgical Center (ASC) group upon implementation of OPPS.
- 2-100.B-REF modified to allow service line reporting of the home health payment percentage, when effective. This segment applies to ASC and Home Health PPS, but does not apply to APC payments.
- 2-110.A-AMT modified to allow service line reporting of the allowed amount for APC and home health HIPPS payments.
- The standard provider level adjustment reason codes in Appendix B have been expanded to include the X12 835 code of BN (bonus) for the reporting of transitional OPPS payments. Make the same "pen and ink" change to the corresponding pages in the version 3030M and 3051.3A implementation guides. This is a claim level segment and will need to be reported in those versions. (Since those versions were established in obsolete software which is no longer supported, replacement pages cannot be attached to this instruction for those versions.)
o Treat the amount determined payable for an OPPS service, whether APC, AWP, etc., as the allowed amount for a service in version 3051.4A.01. The type of bill in CLP08 identifies whether a service is an outpatient hospital, CMHC, HHA or other category of intermediary processed claim. In multiple payment option situations, Medicare routinely uses the highest rate permitted by law to determine payment. A remittance advice does not typically identify which of the possible cost bases is being used for payment.
o Report services that do not have a related APC, and which are considered to be included in the payment for one or more other APCs, with Group Code CO and reason code 97 (payment included in the allowance for another service/procedure) in version 3051.4A.01. If a non-APC service on the same claim is denied for another reason, such as not reasonable or necessary (CO 50), report the specific reason code that applies to that denial rather than CO 97.
o Use the 835 version 3051.4A.01 bundling methodology to report APC payment when multiple HCPCS are included in a single APC. When bundling services into an APC grouping, report service line information back to a provider in the same way as billed, so the provider may automatically identify the services involved and post payment information to patient accounts.
o Report each procedure billed in a version 3051.4A.01 remittance advice, even if bundled for payment into a single APC. However, report the payment for all of the services in a single APC on the line for the first listed service in that APC. Since the payment for the entire APC will be higher than for that procedure code alone, you must enter group code OA (other adjustment) and reason code 94 (processed in excess of charges) for the amount of the excess (difference between the billed amount for the service and the allowed rate for the APC) as a negative amount to enable the line and claim to balance. Report the remaining procedures for that APC on the following lines of the remittance advice with group code CO and reason code 97 (payment included in the allowance for another service/procedure) for each. Repeat the process if there are multiple APCs for the same claim.
The FISS maintainer must make changes to the PC-Print software to correspond to these changes to Medicare's version 3051.4A.01 835 implementation guide and to the Medicare SPR. The maintainer must make the revised PC-Print software available to all intermediaries at the same time
20
as the OPPS system release. You must then internally test the software and share it with those providers who will use version 3051.4A.01 of the 835.
See Attachments 1, 2 and 3.
Medical Review
The methodology of review for hospital outpatient and CMHC claims does not change under the OPPS. The goal is to identify inappropriate billing for hospital outpatient and partial hospitalization services and to ensure that payment is not made for non-covered services.
The revised OCE edits will suspend claims for medical review. However, the claims processing systems must assure that the suspended claim has passed through all medical review edits (e.g., focused and random) before the claim is reviewed. Conduct complex medical review of all claims that are referred to medical review from the OCE until otherwise directed. Continue to select claims on a random basis, and focused medical review using guidelines specified in MIM §3920--Medical Review of Hospital Outpatient Claims. For random review, select a limited sample of prepay claims that have been approved for payment by the OCE (i.e., claims that have not been denied or suspended for medical review). Since OCE does not make coverage determinations these claims must be reviewed to ensure that the services billed were reasonable and necessary.
Regarding focused medical review, establish edits which support prepayment or postpayment focused review based on the guidelines in MIM §3939, such as targeting providers with significant error rates and providers demonstrating questionable utilization patterns such as consistent upcoding of HCPCS/modifier codes. High cost drugs and devices qualifying for transitional pass-through payments as identified in the BBRA shall be included in this review as per MIM §3920.2B review guidelines. Use focused medical review strategy for the majority of your medical review workload.
Make a payment determination as to whether the billed HCPCS/modifier codes are appropriate (i.e., if the service(s) is reasonable and necessary; not excluded from coverage; furnished; and all other requirements for coverage are met) based on the information on the claim, paid history file, or provider solicited medical documentation. Use the following guidelines when making coverage determination:
o Determine if the billed HCPCS/modifier code meets all coverage requirements (i.e., covered), if applicable accept the claim as submitted;
o Determine if the service billed was covered but billed at an inappropriately higher level. If applicable, adjust the bill by selecting the appropriate HCPCS/modifier code that reflects the services provided to the beneficiary. The reviewer uses a system flag/indicator with the appropriate HCPCS/modifier code to indicate whether the HCPCS code or modifier or HCPCS code and modifier were changed. All changes should be reflected on the remittance advice. The system shall be able to collect and report both the original and reviewer adjudicated HCPCS/modifier billed, and the amount billed and subsequently paid. Only the new HCPCS code/modifier will be sent to CWF until October 1, 2000. After October 1, 2000 send both the denied HCPCS/modifier and the new HCPCS/modifier to CWF;
o Determine if some of the services furnished and billed were not reasonable and necessary, and if so, deny those services. If a primary procedure is determined to be non-covered and is denied by MR, then the associated ancillary or component services should also be denied. If all services billed on the claim were not reasonable and necessary, deny the entire claim;
o Determine if some of the services furnished are excluded from coverage, and if so, deny those services. If a primary procedure is determined to be non-covered and is denied by MR, then the associated ancillary or component services should also be denied. If all services billed on the claims are excluded from coverage, deny the entire claim; and
21
o Determine if the billed HCPCS/modifier code was not furnished, and if so, deny the code and apply the fraud and abuse guidelines in MIM §3950.
For any full or partial denials made, adjust the claim accordingly to prevent or recover the overpayment. A partial denials is defined as either the disallowance of specific billed HCPCS/modifier code(s) or reclassification into a lower code. Partial denials based on classification into a new HCPCS/modifier code or full denial(s) because the services were not considered reasonable and necessary, are subject to appeal rights.
Consider particular areas of vulnerability in your data analysis and review activities (MIM §3920.2B review guidelines). Examples of vulnerable areas include:
o Incorrect coding;
o Duplicate processing of OPPS services under carrier billing;
o Unrelated ÷amp; EM procedure codes (modifier 24 ÷amp; 25) with single/multiple surgeries;
o Billing multiple same day visits on separate claims; and
o Inappropriate use of partial hospitalization.
For partial hospitalization claims use medical review guidelines found in PM A-99.39, dated September 99, to review partial hospitalization claims that are suspended for medical review from the OCE or other edits.
Concerning workload, we acknowledge that there is a mid-fiscal year (FY) change in review activity. We feel that this should not significantly impact your ability to meet your remaining FY negotiated workload. The medical review workload for random and focused medical reviews are to be reported to HCFA using the current reporting mechanism. (i.e., report of benefit savings, Medicare administrative and financial management system, and focused medical review reports). Segregate MR workload, costs and savings resulting from the reviews attributed to the OCE (a reporting process is being considered). For claims that suspend for both regular MR and OCE medical review, continue to count these claims under usual workload and associated costs and savings (not under OCE related workload, etc.). By identifying this workload you will be better able to determine the effect of the OCE and focused/random reviews on your regular medical review workload.
For data analysis, include the OCE and related workload. The standard system will be able to collect and report, on a monthly basis, the total number of claims suspended to medical review, the number of claims paid and denied (full and partial, such as line item), and the dollar amount billed and denied
(i.e., covered and noncovered).Provider Notification
Please use information in this PM to notify your providers of the OPPS and the resulting changes to billing. Assure that your providers receive this bulletin prior to May 1, 2000.
The implementation date of this Program Memorandum (PM) is July 1, 2000.
The effective date of this PM is July 1, 2000.
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Funding will be made available through the regular budget process for implementation.
This PM should be discarded after July 1, 2001.
Contractors should contact the appropriate regional office with any questions.
3 Attachments
Attachment I
INTEMEDIARY NAME / ADDRESS / CITY / STATE / ZIP / PHONE NUMBER PROVIDER NUMBER/ PART A PAID DATE: MM/DD/CCYY REMIT#: 1234567890 PAGE 1 NAME PATIENT NAME PATIENT CNTRL# RC REM DRG# DRG OUT AMT COINSURANCE PAT REFUND CONTRACT ADJ HIC# ICN RC REM OUTCD CAPCD COVD CHGS ESRD NET ADJ PER DIEM RTE FROM DT THRU DT NACHG HICHG TO RC REM PROF COMP MSP PAYMT NCOVD CHGS INTEREST PROC CD AMT CLM STATUS COST COVDY NCOVDY RC REM DRG AMT DEDUCTIBLES DENIED CHGS NET REIMB 123456789012345678 1 1 12345678901234567890 123 1234 123 1234567.89 1234567.89 1234567.89 1234567.89 1234567890123456789 12345678901234567890 123 1234 1 1 1234567.89 1234567.89 1234567.89 12345678 12345678 12 1 123 123 1234 1234567.89 1234567.89 1234567.89 1234567.89 1234567.89 12 1234 1234 1234 123 1234 1234567.89 1234567.89 1234567.89 1234567.89 SUBTOTAL FISCAL MMCCYY 12345678.90 12345678.90 12345678.90 12345678.90 YEAR 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345 12345 12345 12345678.90 12345678.90 12345678.90 12345678.90 SUBTOTAL PART A 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456 123456 123456 123456789.01 123456789.01 123456789.01 123456789.01 2000 VERSION
2
INTEMEDIARY NAME / ADDRESS / CITY / STATE / ZIP / PHONE NUMBER PROVIDER NUMBER / PART B PAID DATE: MM/DD/CCYY REMIT#: 1234567890 PAGE 2 NAME PATIENT NAME PATIENT CNTRL# RC REM DRG# DRG OUT AMT COINSURANCE PAT REFUND CONTRACT ADJ HIC# ICN RC REM OUTCD CAPCD COVD CHGS ESRD NET ADJ PER DIEM RTE FROM DT THRU DT NACHG HICHG TO RC REM PROF COMP MSP PAYMT NCOVD CHGS INTEREST PROC CD AMT CLM STATUS COST COVDY NCOVDY RC REM DRG AMT DEDUCTIBLES DENIED CHGS NET REIMB 123456789012345678 1 1 12345678901234567890 123 1234 123 1234567.89 1234567.89 1234567.89 1234567.89 1234567890123456789 12345678901234567890 123 1234 1 1 1234567.89 1234567.89 1234567.89 12345678 12345678 12 1 123 123 1234 1234567.89 1234567.89 1234567.89 1234567.89 1234567.89 12 1234 1234 1234 123 1234 1234567.89 1234567.89 1234567.89 1234567.89 SUBTOTAL FISCAL MMCCYY 12345678.90 12345678.90 12345678.90 12345678.90 YEAR 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345678.90 12345 12345 12345 12345678.90 12345678.90 12345678.90 12345678.90 SUBTOTAL PART B 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456789.01 123456 123456 123456 123456789.01 123456789.01 123456789.01 123456789.01 2000 VERSION
3
INTERMEDIARY NAME / ADDRESS / CITY / STATE / ZIP / PHONE NUMBER PROVIDER NUMBER / NAME PAID DATE: MM/DD/CCYY REMIT#: 1234567890 PAGE 3 SUMMARY CLAIM DATA: PASS THRU AMOUNTS: CAPITAL: 123,456,789.01 PROVIDER PAYMENT RECAP: DAYS: RETURN ON EQUITY: 123,456,789.01 COST: 1234567 DIRECT MEDICAL EDUCATION: 123,456,789.01 PAYMENTS: COVDY: 1234567 KIDNEY AQUISITION: 123,456,789.01 DRG OUT AMT: 123,456,789.01 NCOVDY: 1234567 BAD DEBT: 123,456,789.01 INTEREST: 123,456,789.01 NON-PHYSICIAN ANESTHETISTS: 123,456,789.01 PROC CD AMT: 123,456,789.01 CHARGES: TOTAL PASS THRU: 123,456,789.01 NET REIMB: 123,456,789.01 COVD: 12,345,678.90 HEMOPHILIA ADD ON: 123,456,789.01 TOTAL PASS THRU: 123,456,789.01 NCOVD: 12,345,678.90 PIP PAYMENT: 123,456,789.01 PIP PAYMENTS: 123,456,789.01 DENIED: 12,345,678.90 SETTLEMENT PAYMENTS: 123,456,789.01 SETTLEMENT PYMTS: 123,456,789.01 ACCELERATED PAYMENTS: 123,456,789.01 ACCELERATED PYMTS: 123,456,789.01 REFUNDS: 123,456,789.01 REFUNDS: 123,456,789.01 PROF COMP: 12,345,678.90 PENALTY RELEASE: 123,456,789.01 PENALTY RELEASE: 123,456,789.01 MSP PAYMT: 12,345,678.90 TRANS OUTP PYMT: 123,456,789.01 TRANS OUTP PYMT: 123,456,789.01 DEDUCTIBLES: 12,345,678.90 HEMOPHILIA ADD ON: 123,456,789.01 COINSURANCE: 12,345,678.90 PAT REFUND: 12,345,678.90 WITHHOLD FROM PAYMENTS: WITHHOLD: 123,456,789.01 INTEREST: 12,345,678.90 CLAIM ACCOUNTS RECEIVABLE: 123,456,789.01 NET PROVIDER PAYMENT: 123,456,789.01 CONTRACT ADJ: 12,345,678.90 ACCELERATED PAYMENTS: 123,456,789.01 (PAYMENTS MINUS WITHHOLD) PROC CD AMT: 12,345,678.90 PENALTY: 123,456,789.01 NET REIMB: 12,345,678.90 SETTLEMENT: 123,456,789.01 CHECK / EFT NUMBER: 1234567890 TOTAL WITHHOLD 123,456,789.01
